The resulting matrix includes 41 issues across four categories: access to health, environmental sustainability, employees, and ethics and transparency. It was completed in 2014 and is based on both internal and external research and surveys .
As head of the pharmaceutical giant, Frazier oversaw an assessment of which issues are most important to each of these stakeholders, and weighed them against how significantly each impacts performance.
When Kenneth Frazier became CEO of Merck & Co. in 2011, he knew from the outset that consideration of all the company’s stakeholders — customers, investors, employees, and society at large — was going to be crucial to the success of his tenure.March 13, 2018
“Creating long-term value, (Frazier) considers all of his company’s stakeholders, not just investors.”
Reputation value: economic benefits of stakeholders’ expectations..
Reputations are valuable strategic intangible assets. Threats to these assets⏤ enterprise reputation risks, often mislabeled “brand risks” ⏤ need to be managed, and management needs to be overseen through reputation risk governance lest reputational damage or reputational harm result in long-tailed go-forward losses in economic value and/or political power. Because these intangible risks arise from the interplay of stakeholder expectation, experiences, and media amplification, parametric insurances for intangible asset risks, for reputational value, for reputational harm, and for reputation assurance help mitigate risk by telling a simple, convincing and completely credible story of quality reputation governance to stakeholders. This story telling effect is the expressive power of insurance complementing insurance’s better known instrumental power of indemnification.
Risk management, risk financing in insurance captives, and risk transfer through reputation insurances comprise the constituent elements of a comprehensive solution. What’s your strategy?