A Roundup of latest research has revealed some interesting findings for Reputation Managers:
1. Reputation risk management is becoming an important management consideration.
New research from UK law firm Schillings reveal that Reputation risk management is moving up the corporate agenda, with almost two-thirds (63 percent) of senior executives—including communications directors, heads of legal, CEOs and risk managers—indicating that they are dedicating more time to the discipline than they did two years ago.
For the majority of those interviewed (72 percent), reputation risk is dealt with under the broader risk management framework. But a growing number of pioneers (17 percent) are starting to treat the management of reputation risk as a separate function with formal reporting to the board, and some companies have restructured their leadership team and reporting systems: five of the FTSE 100 have introduced steering groups to focus on reputation risk.
EisnerAmper’s Fifth Annual Board Of Directors Survey 2014 on Concerns about Risks Confronting Boards found that though reputation continued to occupy ever increasing mind share amongst directors, larger organisations such as those with more than $ 1 billion in revenues, as well as private companies, now accorded a higher rating to cyber security or IT risks rather than reputation damage i.e. there is heightened understanding of the danger and velocity social media risks impose. Any systemic failure of cyber security, or an IT mishap, can instantly impact a company’s reputation, sometimes irredeemably, through negative publicity on social media. (This has happened to some of our South African Banks and Telecommunications operators).
2. Organizations that involve PR in strategic planning are more likely to have better external reputations.
Findings from another study – the eighth biennial Communications and Public Relations Generally Accepted Practices (GAP VIII) Study shows that more companies are seeing the value of public relations and its role in organizational success and that here is an important point: organizations that involve PR in strategic planning are more likely to have better external reputations. The study also showed the growing importance of measuring strategies.
3. Marketing and Communication Roles are Converging
In yet another study, Weber Shandwick, one of the world’s leading global public relations firms, found that the rate of chief communications officers with marketing oversight is on the rise (up 35% since 2012). The firm recently conducted new research, Convergence Ahead: The Integration of Communications and Marketing, to understand the experiences of executives at the center of this trend and who have successfully integrated marketing and communications, two traditionally siloed and disparate functions.
They also found that: “All stakeholders hear company messages through one enterprise voice today,” said Micho Spring, chair, Global Corporate practice, Weber Shandwick. The explosion of digital media technologies and channels makes the integration of marketing and communications imperative in developing a cohesive and authentic enterprise narrative.”
So the lessons: Reputation Risk Management is becoming a separate discipline. PR has to play a closer role in Risk Management. Corporate Reputation and Brand Management is converging., and Velocity is now a real factor.
This reminds me of BP- Amoco’s “Eye of the Needle” model years ago (before the Gulf of Mexico) debacle. At BP a number of functions reported to a Director – the so-called “Eye of the Needle”.This was apparently changed later with detrimental effect.
The latest research findings just confirms what I have always proposed: A Stakeholder Reputation Management approach. A Stakeholder Reputation Management approach advocates and understands that organizational reputation is derived from the way stakeholders perceive the organization, how they think, feel or act towards it. It is therefore vital that organizations interested in developing and building their reputational capital; pay careful attention to how they are perceived and; that they manage the relationships with their various stakeholders like a strategic resource.
The management of and interaction with stakeholders therefore needs careful attention if an organization wants to maximize its opportunities and minimize threats in dealing with stakeholders.
This approach now needs to include understanding of Convergence and far more systemic thinking.
The takeaway: Corporate Reputation Management is a strategic function and not just the domain of the PR or Communications department.