![Mitigate value-destroying legal risk. For Fox, Kossovsky said. “This new reputation at FOX Corporation, if it [is] indeed forming, is or will be value-destroying.”](https://steelcityre.com/wp-content/uploads/2023/10/20231016b-Steel-City-Re.jpg)
Fox experienced a surge in reputational risk in the summer of 2021, according to reputational risk insurance provider Steel City Re’s resilience monitor. […] “Reputation risk is usually triggered by missed expectations,” Kossovsky said. “Arguably, stakeholders expected that Rupert Murdoch would once again pull the organization back from the brink after an ethically questionable strategy went sour. They’ve been disappointed.”
Steel City Re CEO and former Los Angeles County deputy coroner on what derailed the ESG movement & what boards expect from risk management in the aftermath.
![In a world of polycrisis, […] risk managers need to… market the elevated quality of their risk management processes.](https://steelcityre.com/wp-content/uploads/2023/09/20230926-Steel-City-Re.jpg)
In a world of polycrisis, […] risk managers need to… market the elevated quality of their risk management processes. The author thanks for their contributions to this article:
Courtney Davis Curtis, University of Chicago; Deyna Feng, Cummins, Inc.; Mary C. Friedl, Redbox; Kathleen A. Graham, The HQ Companies; Chris Hammond, Stepan; Enya He, Blu Clarity PBC; Carnell R. Jones, Trinitas Ventures; Christy Kaufman, Zillow Group; John C. Kline, Discover Financial Services; Manuel Padilla, MacAndrews & Forbes Incorporated; Soubhagya Parija, FirstEnergy and New York Power Authority; Kristen Peed, CBIZ; Theresa Severson, Kite Realty Group; Seung Yoo, Regal Rexnord Corporation; and Denise Williamee, Steel City Re.
![A new generation of risk managers trained specifically in the role and with a deep understanding of risk and risk transfer is reevaluating how they use insurance, increasingly preferring to manage and self-insure their own risks instead of relying on the open market. […] “We reinsure captives not to transfer the bulk of the risk, which is essentially equity risk from a capital perspective, but for the strategic purposes of affirming the quality of risk management.](https://steelcityre.com/wp-content/uploads/2023/09/20230911-Steel-City-Re.jpg)
A new generation of risk managers trained specifically in the role and with a deep understanding of risk and risk transfer is reevaluating how they use insurance, increasingly preferring to manage and self-insure their own risks instead of relying on the open market. […] “We reinsure captives not to transfer the bulk of the risk, which is essentially equity risk from a capital perspective, but for the strategic purposes of affirming the quality of risk management.
We help risk managers manage risk and add value across Boardrooms, C-Suites, and operational silos through reputation resilience.
The industry saw its biggest decline in sentiment since 2018, according to American Banker’s annual reputation survey, with regional banks accounting for the bulk of this deterioration. […] the findings were a “powerful” showcase of how vulnerable banks’ reputations are to periods of crisis.
Backlash Over AI Work. Companies can mitigate the risk of backlash by encouraging collaboration between IT, enterprise risk management and communications within the organization, as well as getting the board involved in overseeing the risk management process, said Steel City Re’s Kossovsky.
ESG risk is one of a growing number of stakeholder-centric issues falling under the greater rubric of reputation risk. High-profile, costly risk management failures at AB InBev (Bud Light), Southwest Airlines and Silicon Valley Bank indicate that it is time for risk management to be more fully integrated into corporate processes, like marketing: #letriskmanagersmanagerisk! Reputation risk management needs to be a standard area of enterprise risk management responsibility. Can we drink to that?
Lead enterprise-wide strategy. Risk management is surely broken. Ambitious risk managers committed to upgrading risk strategy and creating enterprise value with better enterprise intelligence, strategic packaging and a unified organization can fix it.
A risk strategy, is, well, strategic. You know, it boosts value. If no one knows your firm has effective thoughtful risk management and dutiful governance over all that is mission critical, can it possibly be strategic? As the path to boosting equity value through share buybacks becomes increasingly expensive, this is a vital question CRO’s, CFO’s and board risk committees need to ask their risk leadership.