Economics “Is Reputational Risk a C-Suite Priority?”

Good piece on today on repetitional risk, something I get asked a lot about but is still kind of hard to nail down sometimes. This reference to the the work of Prof. Robert Hoyt, is a nice way to thin about it:

Robert E. Hoyt, a professor of risk management and insurance at the Terry College of Business at the University of Georgia, observes that a good deal of research has been done on reputational value. “The issue has taken two tracks,” he says. “One track is to measure reputation through the satisfaction of stakeholders — a qualitative approach.” The second and more reliable perspective, he says, is to “ascribe an intangible value to reputation — a thing beyond the hard physical aspects of a firm.”

Some of the research has looked at whether a firm has “a high valuation relative to its tangible assets or to the hard revenues the firm is currently generating. That additional valuation would be ascribed [in part] to reputation,” says Hoyt. While reputation is but one aspect of that value, “the literature has typically said it would be arguably highly correlated,” he adds.

Full text here:

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