Why compliance isn't stopping scandals

In Rethinking Reputational Risk, Anthony Fitzsimmons and Derek Atkins explore the problem of managing risks, but provide only half the solution.

by Simon Burton

Tesco, Volkswagen, BP, Serco, RBS - there seems to be a never-ending stream of companies who have messed up. Yet this is happening at the same time as companies are spending more money on risk management and compliance than ever before in the history of business. So why do things still keep going wrong?

I was working inside one of those multinational companies when they famously screwed up. My experience at the commercial coalface has given me some insight into why the current huge effort on risk management doesn't always reap rewards. And this is a perspective which is shared by the authors of this new book on tackling reputational risk.

Risk management all too often apes the starting point of economics: it is predicated on rational human beings acting in a rational way. But senior executives are not always rational; neither are a company's various stakeholders (investors, NGOs, media or employees). It is this heady brew that can often give rise to reputational risk which, if not anticipated, managed or mitigated, creates the headlines and ultimately hurts the value of the business.

Sign in to continue

Sign in

Trouble signing in?

Reset password: Click here

Email: mtsupport@haymarket.com

Call: 020 8267 8121



  • Up to 4 free articles a month
  • Free email bulletins

Register Now

Become a subscriber

From £66 a quarter

  • Full access to managementtoday.co.uk
  • Exclusive event discounts
  • Management Today's print magazine
  • Plus lots more, including our State of the Industry Report.

Choose a Package