Marcus Alcock, editor of Emerging Risks focuses on the biggest threats, that he believes, businesses will be facing in 2022.
The reputational risk landscape has changed significantly in recent years, as the risk profiles of businesses continue to evolve at an ever-faster pace across all industries.
The threat to brand and reputation have been climbing up boardroom agendas for years. Indeed, according to a recent report by KPMG, corporate brand and reputation accounts for approximately a quarter of the value of the world’s leading stock markets.
Similarly, another recent survey found that 86% of businesses participating, were concerned about loss of income and a reduced customer base due to reputational risk. In my opinion, 2022 will really cement the importance of this key emerging risk.
The biggest threats to brand and reputation tend to emerge as impacts from other, usually interconnected, operational risks
that collide to crystallise into issues that become public. A failure to manage the risks is therefore a double whammy: not only must the business address the pressing risk, (e.g. a cyber attack), but it must also face the inevitable damage to its reputation and ultimately its brand value.
The fact is that, in today’s increasingly interconnected world where social media can spread information around the globe to millions in seconds, there is nowhere to hide for a business whose reputation has been tarnished. Indeed, reputation should perhaps now be viewed as a company’s most valuable intangible asset.
What this means is that companies need to think very carefully about not just their internal processes and standards, but also those of the companies they do business with or have a stake in.
For example, businesses need to be able to demonstrate that their supply chains are not only robust, but also that those individual companies within those supply chains adhere to modern Environmental, Social and Governance (ESG) standards as well.
About the author
Marcus Alcock - Editor, Emerging Risks
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