“in the event that the reputation…provides trust to society or the consumer, the parent company is liable for the trust created by utilization of this reputation”.
Reputation risk is the peril of economic or political damage from angry disappointed stakeholders when expectations are not met. Under Turkish law, “(T)he scope of the liability consists of the damages caused by the expectation arising from the trust.” What’s your risk mitigation and management strategy?:
Uh Oh. Liability Features of Reputation Risk.
May 23, 2018
Mondaq
“The scope of the liability consists of the damages caused by the expectation arising from the trust.”
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?