A recent study from reputation management consultancy Standing Partnership found that most senior executives rank their organization above-average at building (78%) and managing (72%) a positive reputation.
They may be far less equipped to detect and correct failures, however, as only 53% are confident in their team’s ability to identify reputational risks before they develop into crises and 45% are certain of their ability to develop risk mitigation strategies. What’s more, only 53% take steps to monitor for reputational risk issues.
More than 25% of respondents said their organization has experienced a reputational issue that led to lost revenue, increased operating, capital or regulatory costs, or caused destruction of shareholder value.
“The true cost of reputational damage is often underestimated because it doesn’t always consider the full extent of the corrections that are needed; the ramifications typically extend well beyond the area of direct impact,” said Melissa Lackey, president and CEO of Standing Partnership. “Building cross-functional reputation risk auditing and planning into an organization’s accountability framework can help companies avoid significant hits to their brand, stakeholder perceptions and—most importantly—to their bottom line.”