“Enterprise risk managers, who now often hold the title treasurer, chief risk officer or chief financial officer, know how to talk to market analysts, creditors and other financially savvy stakeholders. They will also immediately understand the importance of third-party analyses and the type of insurance products that are now available that act as warranties on governance—making clear to lawyers, activist investors, regulators and others that outside underwriters have confidence in their systems and practices.”QSR
June 22, 2019
“Reputation risk should be managed by risk managers rather than by marketers.”
Reputation risk: The peril of economic harm from angry disappointment stakeholders.
For a broader view of reputation risk, discover additional articles by Steel City Re here, mentions of Steel City Re here, and comments on newsworthy topics by Steel City Re here. To read an abstracted summary of reputation risk, see below.
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.
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