A couple of days ago I was the keynote listener in a discussion with a couple dozen members of corporate boards on the subject of reputation management. Here’s what they had to say:
- They believe their boards are doing a good job on the process element of tracking reputation risk as part of overall enterprise risk management.
- Not surprisingly, those who have experienced a crisis that made vulnerabilities more apparent have seen their companies increase the sophistication of their reputation tracking and related board discussions.
- Specifically, some reported their boards are getting greater value by not just tracking and estimating reputation risk but by focusing less on process and more on substantial discussion around specific vulnerabilities.
- There is clear recognition that reputation is “bankable” and important to preserving relationships with all stakeholders when issues or crises arise, including not just employees, customers and investors but also regulators, lenders, partners and suppliers.
- Likewise, directors are acutely aware that social media has amplified reputation vulnerabilities, the importance of ongoing monitoring and the need for speed and transparency.
- They recognize that the companies that are best at building and managing reputations have the building blocks (honesty, transparency, humility, consistency and accountability) emanating from the CEO and integrated into their cultural DNA.
One director summed up the board’s responsibility by saying, “It’s not enough to try to grade reputation risk on a 10-point scale and talk about what’s being done to lower the number. Directors have to talk about specific vulnerabilities, help management identify ways to reduce them and hold them accountable for doing it.”