Browse Definitions :
Definition

reputation risk

Contributor(s): Ivy Wigmore

Reputation risk is the threat to the profitability or sustainability of a business or other entity that is caused by unfavorable public perception of the organization or its products or services. Reputation risk management is a component of reputation management, which seeks to shape the public perception of an organization or a brand.

Business sustainability relies on the careful management and coordination of environmental, social and financial demands and concerns to ensure responsible, ethical and ongoing success. Anything that impinges upon any of those elements can create reputation risk, especially in these days of social media when experiences and opinions are shared swiftly and widely online.

Reputation risk is strongly correlated with conduct risk, which is threat that results directly from an organization’s actions. Although reputation risk can also result from issues that are beyond the control of the organization, the most important element of reputation management is ensuring scrupulous business practices.

To some extent, reputation risk is an expansion of how an enterprise thinks about its problems and failures, whether actual or potential. Traditionally, for example, the effects of a product recall might be evaluated in terms of the expected profit that had been lost or the cost of repairs or replacements. However, that failure is likely to have broader effects, such as a loss of confidence in the company's products that impacts future sales. Similarly, the effects of a data breach are likely to be far-reaching.

This was last updated in May 2017

Continue Reading About reputation risk

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.

-ADS BY GOOGLE

File Extensions and File Formats

SearchCompliance

  • California Consumer Privacy Act (CCPA)

    The California Consumer Privacy Act (CCPA) is legislation in the state of California that supports an individual's right to ...

  • compliance audit

    A compliance audit is a comprehensive review of an organization's adherence to regulatory guidelines.

  • regulatory compliance

    Regulatory compliance is an organization's adherence to laws, regulations, guidelines and specifications relevant to its business...

SearchSecurity

  • spear phishing

    Spear phishing is an email spoofing attack that targets a specific organization or individual, seeking unauthorized access to ...

  • bridge

    A bridge is a class of network device that’s designed to connect networks at OSI Level 2, which is the data link layer of a ...

  • browser isolation

    Browser isolation is a cybersecurity model for web browsing that can be used to physically separate an internet user’s browsing ...

SearchHealthIT

SearchDisasterRecovery

  • disaster recovery team

    A disaster recovery team is a group of individuals focused on planning, implementing, maintaining, auditing and testing an ...

  • cloud insurance

    Cloud insurance is any type of financial or data protection obtained by a cloud service provider. 

  • business continuity software

    Business continuity software is an application or suite designed to make business continuity planning/business continuity ...

SearchStorage

  • business impact analysis (BIA)

    Business impact analysis (BIA) is a systematic process to determine and evaluate the potential effects of an interruption to ...

  • RAID (redundant array of independent disks)

    RAID (redundant array of independent disks) is a way of storing the same data in different places on multiple hard disks to ...

  • dedicated cloud

    A dedicated cloud is a single-tenant cloud infrastructure, which essentially acts as an isolated, single-tenant public cloud.

Close