Goldman Sachs moves reputational risk up the agenda
By Amy Wright - Financial & Professional Services Client Manager, Echo Research Ltd.
It has become increasingly difficult to read an article about Goldman Sachs without finding a reference to the now infamous Rolling Stone “vampire squid” article. But I found one in The Guardian this week which has been echoed in the US and elsewhere. It seems that the Goldman Sachs annual report has listed (for the first time) “negative publicity” as a risk factor in the organisation’s continued prosperity, although it also notes that it is “time consuming and expensive” to respond to criticism.
They have a point. With the volume of negative coverage directed at GS, I wonder whether it is possible for an organisation that is treated in some quarters as the source of all financial evil to respond adequately to such criticism. Recent attempts to engage the press (including the news that GS would be donating $500m to charity) have simply led to renewed levels of venom.
However, in the brave new world we live in, demands for transparency from high-profile companies mean that it is not possible to hide from the media and hope that they choose someone else to pick apart – at some point you have to recognise the howls of indignation and engage. So I’m not surprised that reputation has risen to the top of the agenda at GS, and I’m sure that the communications teams at the bank, which has traditionally let its phenomenal financial success do the talking, are working hard with the senior management to understand how and where change is required.
By reporting on negative external perceptions within its overall corporate risk assessment, an important first step has been made. It will be interesting to see if others follow suit, and indeed how robust reputational risk measurement systems are adopted and used to shape leadership behaviour and communications strategy.
Click here to view the Guardian article
It has become increasingly difficult to read an article about Goldman Sachs without finding a reference to the now infamous Rolling Stone “vampire squid” article. But I found one in The Guardian this week which has been echoed in the US and elsewhere. It seems that the Goldman Sachs annual report has listed (for the first time) “negative publicity” as a risk factor in the organisation’s continued prosperity, although it also notes that it is “time consuming and expensive” to respond to criticism.
They have a point. With the volume of negative coverage directed at GS, I wonder whether it is possible for an organisation that is treated in some quarters as the source of all financial evil to respond adequately to such criticism. Recent attempts to engage the press (including the news that GS would be donating $500m to charity) have simply led to renewed levels of venom.
However, in the brave new world we live in, demands for transparency from high-profile companies mean that it is not possible to hide from the media and hope that they choose someone else to pick apart – at some point you have to recognise the howls of indignation and engage. So I’m not surprised that reputation has risen to the top of the agenda at GS, and I’m sure that the communications teams at the bank, which has traditionally let its phenomenal financial success do the talking, are working hard with the senior management to understand how and where change is required.
By reporting on negative external perceptions within its overall corporate risk assessment, an important first step has been made. It will be interesting to see if others follow suit, and indeed how robust reputational risk measurement systems are adopted and used to shape leadership behaviour and communications strategy.
Click here to view the Guardian article
The opinions and views expressed in this blog are the personal opinions of the writer and do not necessarily represent the views of Echo Research, its staff or any of its affiliates.
Labels: banks, communications, Goldman Sachs, guardian, mediaresearch, risk assessment, Rolling Stone
posted by Echo Research @ 01:39
1 Comments
1 Comments:
Fascinating stuff - reputational risk is hard to measure, but no sane businessperson can doubt its value. My experience though is that it's the most under-protected asset of all. And I still don't really understand why companies adopt this cavalier attitude. Let's hope that the GS approach is a sign of a more enlightened attitude.
Jonathan Hemus
www.insigniatalks.com
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