Some 86 per cent of Willis Towers Watson (WTW) clients are concerned about loss of income and a reduced customer base due to reputational risk, according to WTW’s 2020 Reputational Risk Survey.
As part of the survey, WTW asked 200 risk managers and executives about how their organisation handles reputational risk and the tools and services they use.
The results showed that 61 per cent said reputational risk is reported at the c-suite or board level (66 per cent) within their organisation.
Almost eight in ten (80 per cent) suggest that the focus on reputational risk in their business will only increase in the coming five years.
The majority of respondents highlighted that reputational risks could result in potentially crippling business outcomes for their organisation such as loss of income (86 per cent) and weakened human capital, because of their reduced ability to retain (62 per cent) or attract (57 per cent) talented employees.
Most risk managers think their companies would face major losses due to reputational damage.
The report notes that 61.5 per cent of risk managers said a loss of talent, due to both retention and turnover, would be a major issue their organisation could face as a result of reputation damage. In addition, 56.5 per cent said being a less attractive employer would be a serious negative outcome.
It also showed that risk managers believe they do not have the tools and support they need to effectively manage reputational risk.
The report points out that 59.5 per cent state that they feel a lack of clear methodology.
When asked to describe the reputation intelligence tools that were available within their organisations, 44 per cent of participants said there weren’t any, or if there are, they weren’t aware of them.
In response to the growing challenge, WTW states they will soon be launching a true value-driven insurance and risk management solution, incorporating cutting edge technology to address our clients' concerns.
Commenting on the report, Garret Gaughan, head of global markets property and casualty (P&C) hub, WTW, says: “Reputational risk is increasingly of concern to our clients with most risk managers now having some responsibility for risk mitigation in this area.”
He continues: “As a previously difficult to insure risk it is unsurprising that all of the survey participants agreed it would be helpful to them to have access to a reputation platform. WTW in partnership with Polecat, a leader in technology and reputation intelligence, have designed a platform that will allow organisations to monitor reputational threats in real-time and provide them with reputational impact scores against their peers for issues and risks.”
“To compliment this platform, WTW will soon be launching a risk transfer solution for this previously uninsurable risk. We believe that this combined approach will deliver reputational risk solutions to address our clients’ needs,” Gaughan adds.
