Case Studies

September 14, 2024

, , , , , , ,
Boeing employees are striking for…more input into product safety. This labor action is a manifestation of lost reputation value. This labor action is a stark reminder that angry, disappointed employees are one of many expressions of a reputation crisis. Corporate leadership and governors must be mindful that that the long tail of reputation risk typically includes costly investor, regulator, and yes, employee actions.

Boeing employees are striking for…more input into product safety. This labor action is a manifestation of lost reputation value. This labor action is a stark reminder that angry, disappointed employees are one of many expressions of a reputation crisis. Corporate leadership and governors must be mindful that that the long tail of reputation risk typically includes costly investor, regulator, and yes, employee actions.

September 10, 2024

, , , ,
At the end of reputation risks’ long tail are board-level consequences, exemplified by the denouement of this infamous winter 2022 crisis precipitated by software quality issues, unaddressed. “Southwest Airlines on Tuesday announced an overhaul of its board of directors, including the planned departure of its executive chairman, Gary Kelly, after a meeting with a hedge fund that has called for sweeping changes at the company.” The takeaway: reputation risk management is always a vital governance issue.

At the end of reputation risks’ long tail are board-level consequences, exemplified by the denouement of this infamous winter 2022 crisis precipitated by software quality issues, unaddressed. “Southwest Airlines on Tuesday announced an overhaul of its board of directors, including the planned departure of its executive chairman, Gary Kelly, after a meeting with a hedge fund that has called for sweeping changes at the company.” The takeaway: reputation risk management is always a vital governance issue.

August 19, 2024

, , , , , , ,
Investors are not good at predicting the net impact of reputation risk. They tend to over or underestimate the net impact on future cash flows on the basis of sentiment and noise rather than on indicators of stakeholder disaffection and behavioral change such as those integral to Steel City Re's premier reputation risk prediction tool, its Resilience Monitor.

Investors are not good at predicting the net impact of reputation risk. They tend to over or underestimate the net impact on future cash flows on the basis of sentiment and noise rather than on indicators of stakeholder disaffection and behavioral change such as those integral to Steel City Re’s premier reputation risk prediction tool, its Resilience Monitor.

August 8, 2024

, , , , ,
Quantas ex-CEO Forfeits Bonus for Reputation Damage

Qantas Airways Ltd. docked A$9.3 million ($6.1 million) from former Chief Executive Officer Alan Joyce’s final payout and announced a governance overhaul after a review partly blamed board and management errors for the carrier’s reputational crisis. This punitive action conforms to heightened expectations this year by both institutional investors and proxy advisers that companies should be clawing back CEO compensation for both reputational damage and for failures in risk management, even if financials do not have to be restated. This should help focus board attention to the factors that increase, protect, and restore reputation value including reputation risk intelligence, risk management, and reputation value insurance (aka, Side R).

June 13, 2024

, , , , , ,
The last lap of Southwest's 18-month reputation crisis. Activists investors! Link to a podcast on the meaning of all this for your company.

And now, the last bits of the tail of a reputation crisis. “Hedge fund Elliott Investment Management announced yesterday that it has a $1.9bn position in Southwest Airlines, comprising 11% of the company’s shares. It issued a letter to the airline’s board, calling for new directors, a new CEO, more executives from outside, and a comprehensive business review. In its letter, Elliott wrote, ‘While Southwest has a proud history, that history is not an argument for supporting poor leadership and sticking with a strategy that no longer succeeds in the modern airline industry.’” Relevant podcast on what this means for your company: https://5-minute-aventures-in-risk-resilience.zencast.website

Topics