more-arw search

Brand and reputation are key to risk management strategies

Executives should tally brand and reputation along with regulatory compliance

Many executives don't consider their company's reputation when evaluating their top risk management priorities, according to a recent survey. But some business owners say it's much more important than it's given credit for, reported CFO Magazine.

The joint survey from insurance brokerage Marsh and the Risk and Insurance Management Society found most C-suite execs rate brand and reputation 16th on a list of risk management priorities, CFO reported. While other important concerns like regulatory compliance and cash-flow liquidity topped the list, the magazine highlighted some of the reasons corporate brass should be more aware of the potential business impact of a slight to the company's reputation.

One California-based medical device manufacturer found itself the focus of a somewhat negative article concerning the dangers of radiation therapies. Although the company helps treat millions of patients, the New York Times article highlighted a handful of cases in which patients had suffered injuries or death during treatment. By reaching out to media relations firms and undertaking customer outreach, the company managed the situation well, but it was a serious challenge.

It can be difficult to place a dollar value on a company's brand and reputation, which could be why so many executives overlook it in their risk management portfolios, said Elisha W. Finney, CFO of Varian Medical Systems, the company damaged by the Times piece. But, she says, every company should be aware of its potential impact and be ready to spend money repairing a broken reputation.