ABSTRACT
Risk to reputation is generally understood to mean the uncertainty surrounding circumstances in which a good reputation may become 'tarnished' tainted or reduced in some way. The impact of reputation risk depends on the cost of recovering trust, and the consequent risk impact grid is similar to the stakeholder response scale. The key difference is that in risk impact terms trust recovery, as opposed to trust damage, is the determining factor. Damage severity can be extreme or slight depending on three things: quality of reputation prior to the incident; the cause of the incident; and the handling of the incident to prevent it becoming a crisis. Six different possible sources of reputation damage are: legal, ethical, executive, operations, associations and environment. To understand these it is first necessary to identify four different types of risk handling strategies: transfer, avoid, manage and mitigate.
