Values, Culture and Reputation Risk
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Values, Culture and Reputation Risk

Paul Holmes

Over at the Arthur W. Page Society blog, Roger Bolton has an interesting follow-up to the recent Page Society conference on culture, in which he considers the cultural roots of recent crises at BP and on Wall Street and suggests that a little more focus on reputational risk might have helped the companies involved avoid. His conclusion is valid and important: “There is not only an opportunity, but an obligation, for the CCO to be active in the C-Suite risk management discussion. Bringing our broad stakeholder view to bear on the question of how to build a culture that gets the right emphasis on risk—encouraging neither too much nor too little—is critical to preserving and protecting the most important asset of any institution: its reputation.” I would make the case that the process—and the involvement of the public relations function in that process—begins not with culture, but with values. I have always believed that any journey that ends with a good reputation begins with a serious evaluation of organizational values. If public relations people are responsible for corporate relationships and reputation, their first task is to define the company’s values; their second is to ensure that those values infuse the culture; and their third is to communicate those values externally. To Roger’s point about risk management, I have always argued that companies can assess the degree to which they are crisis-prone by asking employees three simple questions: 1.Do you understand the values of this organization? 2.Do you believe that management behaves consistently in accordance with those values? 3.Do you feel personally empowered to base the decisions you make on those values? If the vast majority of your employees answer yes to all of those questions, you are probably on safe ground. If you get a high percentage of negative responses to any one of them, you’re probably headed for a crisis.
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