Reputation Risk: An Executive-level Issue
In 1991, during a testimony about his firm’s securities scandal, the famous business magnate Warren Buffett spoke about compliance and following the rules. He finished with the now famous line, “Lose money for the firm and I’ll be understanding. Lose a shred of reputation for the firm, and I will be ruthless.”
It is true, no business or organisation can afford to lose reputation, even one owned by a billionaire. Long before social media was a thing, Buffett asked his executive leaders and employees to consider any action they may take, anything they might say, how comfortable they would be if it was reported on the front page of the newspaper and shared with their spouse. We are now more aware than ever that the slightest wrong word can quickly escalate into a ‘Twitter-storm’. Covfefe, anyone?
Reputation is one of our biggest and most important assets. There is so much at stake, particularly as we represent Christianity to the world, not to mention our custodianship of trusted brands such as Weet-bix and the Sydney Adventist Hospital. If our organisation’s reputation were marred in some way it could be devastating, resulting in lost tithe and offerings, lost members, destruction of trust, decreased intellectual value and lost revenue (in the case of a product or service) and most significantly, lost faith.
Oliver Wyman, a management consulting firm and subsidiary of Marsh-McLennan Companies, declares that it is imperative for executive level leaders to address reputation risks. In its 2014 Reputation Risk report the author’s state, “A mishandled response to a crisis can generate more reputational damage, and spur greater financial consequences, than the incident itself.” And further that this is, “especially true when the response appears to undermine the company’s core values.”
For the Church, failure to properly manage our risk has the potential to not only cause physical damage, injury or financial loss – it can result in untold reputation damage that could have significant impact on the Adventist community and our capacity to make disciples.