US corporations risking a lot by not paying attention to risk

Randy Nornes, EVP of AON Global began this morning's discussion of corporate reputation at the New York Bar Association building in Manhattan by saying that...

Randy Nornes, EVP of AON Global began this morning's discussion of corporate reputation at the New York Bar Association building in Manhattan by saying that US businesses rely more on senior management intuition than analysis when assessing corporate risk.

The presentation was the first of panel discussions hosted by Echo Research, talking about corporate reputation and risk management.

John Flick, director of international PR for UPS, easily rattled off a few of the corporate risk and reputation issues that the company has faced in the past 10 years or so: an employee strike, the inability to deliver a package to the West Bank, the post-9/11 threat of possible terrorists posing as UPS workers, their sponsorship choice - "The good news is we're a Beijing Olympic sponsor. The bad news is we're a Beijing Olympic sponsor."

Peter Horowitz, director of communications at the law firm Shearman & Sterling, stated that while legal exposure is still a concern, there's growing recognition that reputation is significant as well. Perhaps even more important when you consider that a corporate gaffe can live on ad infinitum via new media.

Finally, John Bergen, SVP of corporate affairs and marketing for Siemens USA, talked about the ongoing crisis situation there and the decision to post a detailed outline of their legal troubles with their fourth quarter earnings report. He predicted that the fallout from this situation could last well into the future and, if handled poorly, can determine whether companies will do business with them (Siemens has a presence in over 190 countries). Bergen's advice: "As soon as you find something, say something."

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