The Chicago Risk Forum, 2022 aims to be the premier event for the Chicago RIMS Chapter, partnering with our greater Midwest Risk Management and Insurance Community. The mission of CRF is to provide engaging, industry leading educational opportunities and the ability to network and build professional relationships within the Risk Management and Insurance industry. CRF provides learning opportunities and professional mentorship to students and young risk / insurance professionals.
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Steel City Re, an insurance intermediary and risk advisor for reputation and ESG-linked reputation risk, is a proud sponsor of this year’s forum.
Why This Work is Mission-Critical
Mitigating reputation risk is preferable to managing a reputation crisis and its long tail of economic damage. To this end, Steel City Re offers a Reputation Resilience Program.
A hazard of reputation risk is a lurking gap between stakeholder expectations and reality. Another hazard is the emotional intensity associated with expectations. The peril is anger from disappointed stakeholders. This video and this written summary explain the behavioral economic features of the many perils of reputation risk.
The “heat of the moment” can change stakeholders’ behaviors and ignite a crisis. Changed behaviors can reduce future revenue and increase future costs. Losses accrue as companies lose the ability to sell more, faster, and at premium prices; to obtain labor, vendor services, as well as capital on preferred terms; to outperform competitors, deter activists, and assuage regulators. Public manifestations include litigation, regulatory opprobrium and adverse media attention.
Mitigating risk strategically through expectation management and operational adjustments evinces thoughtful management and dutiful governance. Financing such risks evinces prudence, and doing so publicly enables stakeholders to appreciate and value the effort. These comprise the core of Steel City Re’s professional services.
The need to do so has never been greater. Entry points, monitoring, speed, and risk impact of reputational issues are increasing exponentially in today’s complicated business and communications world. Preparing for adverse events with a crisis communications and management program is necessary, but not sufficient.
Having a robust Reputation Resilience Program in place offers, amongst other benefits:
- Protection for the company, its staff, executives, and board from litigation and regulatory challenges
- Improved governance processes and better enterprise risk management protocols
- Establishment of an agile operating, communications, and decision-making team, with clear roles and responsibilities, trained and ready to handle all reputational threats
- Proactive management of risks that could give rise to delays or derailing concerns around new product and strategic partnership launches
- Captured behavioral economic value from stakeholders
- Reduced costs of debt and risk transfer while boosting equity value
One Last Question
ESG-linked reputation risks are prevalent and material. Are insurances for ESG-linked reputation risk part of your strategy?