Social media reputation now ‘bigger risk than economy or rivals’ for top execs

24/10/2013

Most executives now place reputation above economic trends and competition in terms of risk, following the rise of social media, according to new research.

Asked which of a list of risk areas have the most impact on their business strategies, 40% of global respondents to a Deloitte survey cited reputation, making it their leading concern ahead of threats to their business models (32%), economic trends (27%), and competition (also at 27%).

Those are the views of more than 300 C-level executives, board members and specialized risk executives at large companies, with reputation overtaking brand, 2010′s leading risk. Social media is fueling the concern over reputation, according to the study’s authors.

The survey of 300 major companies reveals how:

• Strategic risk is an area of major focus: 81% of surveyed companies now have an explicit focus on managing strategic risks.

• Reputation is cited as the #1 risk – not just overall, but for most individual industry sectors.

• Strategic risk management is a CEO and board-level priority. Two thirds (67%) of the surveyed companies say the CEO, board or board risk committee has oversight when it comes to managing strategic risk.

• Technology enablers and disrupters, such as social, mobile, and big data, could threaten established business models, and 91% of companies surveyed have changed their business strategies since those technologies began to emerge.

• Human capital and innovation pipeline are expected to be the top strategic assets that businesses will need to invest in.

52% of respondents to the Deloitte survey are managing their strategic risks by increasing the frequency and budget for monitoring and managing risks, while 43% have started to monitor and manage the area continually, and 38% have increased the number of executives assigned to the area.

View the infographic below, illustrating key findings from the survey;

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Source: Deloitte

About the survey

The findings in this report are based on a global survey conducted in the spring of 2013 by Forbes Insights, on behalf of Deloitte. It includes insights from more than 300 respondents from the Americas (33%), Europe/Middle East/Africa (33%), and Asia/Pacific (34%). Nearly all respondents were C-level executives (263), board members (22) or specialized risk executives (21). Surveyed companies came from all five major industry sectors (consumer/industrial products, life sciences/healthcare, technology/media/telecommunications, energy/resources and financial services), and all had annual revenues in excess of US$1 billion (or equivalent).

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