With social media and the 24-hour news cycle it often feels like a major corporate disaster happens every day. As such, reputational risk has become a top priority for senior executives.
However, measuring reputational risk is notoriously difficult, and many companies aren’t doing enough to quantify their risk. The Economist Intelligence Unit reports that up to 90 percent of firms regard corporate reputation as a primary asset, yet only a minority of FTSE100 firms measure and report directly on reputational risk factors. Yet according to Deloitte’s 2014 Global Reputation Risk Survey, 41 per cent of companies that experienced a blow to their reputation saw a significant loss of revenue. Clearly, better measurement of reputational risk is needed.
With these statistics in mind, here are four ways that you and your team can do just that:
- Track your corporate reputation and brand equity in key markets and demographics using social media listening tools. A solid application of linguistics analytics can help you track risks that impact the intangible things that influence your reputation, such as trust and leadership.
- Identify and quantify the reputation of your products for you and your suppliers. Go beyond your corporate brand image to identify which of your products across your production and supply chains might be potentially damaging your reputation. Dissatisfaction with one or more of your products could damage your overall reputation in the long term.
- Pinpoint events that could have a negative impact on your reputation, and put a value on their impact. Building a picture of event-based risks will help you mitigate against them, and devise a good response plan.
- Track the reputations of your competitors and other operating companies. New risk monitoring software can help you track changes in the conversation about certain topics, companies and markets.
By using these methods you can keep your finger on the pulse and minimise your exposure to brand-damaging events. With a measured approach, good data and the right tools, you can build a clearer picture of the risks to your reputation and develop a better approach to risk.