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Reputability LLP are pioneers and leaders globally in the field of reputational risk and its root causes, behavioural risk and organisational risk. We help business leaders to find these widespread but hidden risks that regularly cause reputational disasters. We also teach leaders and risk teams about these risks. Here are our thoughts, and the thoughts of our guest bloggers, on some recent stories which have captured our attention. We are always interested to know what you think too.

Tuesday, 19 July 2011

"Roads to Ruin" is published

What causes organisations to face existential crises? And what turns crises into catastrophes?  "Roads to Ruin", a new report from the Cass Business School for Airmic, the risk managers' association, analyses the entrails of over 20 major crises of various shapes and sizes.  The report was previewed here last month.

The conclusions are stark.  As Anthony Hilton summarised it in today's London Evening Standard, the reasons for failure often emanate from the very top.  Inadequate board skill and poor leadership on ethos are a recurring cause of crises.  And adapting the title of an earlier blog, he wrote: "Too many boards live in a rose-tinted bubble". 

He also highlighted poor internal communication as a source of much of the problem, made worse by the insufficiently high status of risk professionals.  This issue was flagged here last year as regards the financial sector.  Since then, RBS' Chief Risk Officer has taken the road to becoming a bank CEO, fulfilling a prediction of problems that are developing with the arrival of CEO-calibre CROs.

Nick Edwards' interview for Reuters is here.  And Carly Chynoweth wrote a piece on the implications for NEDs in the Sunday Times.

An executive summary of the Report is still available free of charge here; where you will also find a link to buy a copy of the full report from Airmic.  Its well worth reading.

Anthony Fitzsimmons
www.reputability.co.uk

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