ENTERPRISE REPUTATION and RISK MANAGEMENT
Most Entities have a mission that includes an element of building and maintaining trust with those they serve. Whether customers of a company, constituents of a government body, or students of a higher education institution, trust is vital to the success of both parties. Transparency and two-way respectful communication of mission, vision, values, strategies, objectives, risks, and opportunities builds trust within an entity.
Any entity reputation, also referred to as goodwill, is used to quantify and store the trust that has built up over time. Reputations are difficult to build but easy to damage. Enterprise-wide risk management is a key management process that can be leveraged to grow and protect an entity reputation. By empowering each Functional Area to clearly understand the mission and strategies, the functional area leadership each serve in a capacity of key cogs in the wheels of progress to increase the likelihood of the entity achieving the mission, strategies and near and long-term goals.
REPUTATION AND RISK GOVERNANCE FRAMEWORK (RGF)
The value of an entity depends upon the ability of the entity to pursue a mission and strategy valued by others. For example, a founder of a start-up may believe they have the best idea in the world, however, if the minimum viable product (MVP) does not generate customer interest, it will be difficult to obtain investors to fund the mission. The mission, strategy, and operations are interdependent upon each other just as the product, customers, employees, suppliers, etc. are interdependent.
The value of an entity is also contingent upon the entity doing what it said it was going to do (e.g., product function and safety, financial projections, ethical and social behaviors, etc.). This includes elements of both trust and assurance for all key stakeholders including customers, employees, suppliers, investors, communities, etc. This complex and interdependent network of stakeholders is a key part of the secret sauce that builds and maintains enterprise value.
Board of Directors, Executive Leadership, and Functional Area Leadership are all key components and drivers of the Risk Governance Framework. The RGF maps the governance of entity mission, strategy, and key goals and work processes and the corresponding enterprise-wise risks. The purpose of the RGF is to have a transparent understanding of the types of key processes and corresponding current and targeted risk appetite levels required for entity success.