April 10, 2019

“The Church of England and the Swedish ethics council urged all listed mining companies to disclose “every individual tailings facility under their control. (The Church of England’s) letter is supported by 96 investors with $10.3tn in assets under management.”

Financial Times
April 10, 2019

“(Vale) is under pressure from investors to improve its safety record.”

Reputation risk is the peril of economic harm from angry disappointed stakeholders, such as investors and regulators.

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?