By Steven Minsky, CEO of LogicManager, Inc.
Corporate misbehavior is nothing new, and corporations may not be acting any worse than they have in the past. What has changed, however, is the technology that uncovers and disseminates their actions and inactions.
Rapidly advancing technologies that allow for faster information sharing like Facebook, Twitter, Glassdoor, and Yelp have enabled the public to share their opinions instantly. Now, a simple Google search on a company can yield several years-worth of scandals.
According to a 2017 study, approximately 63% of American consumers hope that businesses will take the lead to initiate social and environmental changes going forward, in the absence of government regulation. Where government regulators are slow to act, customers and investors are expecting—and demanding—that companies will work to prevent scandal by mitigating risk.
Companies today are operating in a “see-through economy.” We’re living in an age of transparency where the public is empowered to impact a company’s reputation, and PR departments can no longer control a company’s image, amplifying the impact of their wrongdoings in three ways:
- Consumers can easily set expectations, speak out when they aren’t met, and move their business to companies that meet their expectations.
- Investors can seamlessly connect scandals to corporate negligence and a company’s inability to retain customer loyalty, which has spawned several class-action lawsuits.
- Regulators are attuned to what rights are being neglected and impose sanctions to ensure they are met in the future.
The Facebook and Equifax scandals exemplify this trend. Learn what these two seemingly unrelated risk management failures have in common and what you can do to avoid repeating them in your organization. We’ll share the tactical steps every company should take to avoid regulatory fines, costly litigation, and the even-graver long-term consequences of reputational destruction, without having to invest in expensive technology solutions.
Organizations need to integrate and account for reputational risk across all departments and levels. Implementing enterprise risk management programs with the proper infrastructure is the most effective way for corporations to protect their reputations, consumers, investors, and communities.
Learn more by attending our session, Facebook and Equifax: Meeting Increased Customer Expectations, Not Just Regulatory Requirements, hosted by Steven Minsky, CEO of LogicManager and author of the RIMS Risk Maturity Model. The session runs from 1 pm to 4 pm on October 21, 2018.