A comprehensive study by Willis, a WTW business, has identified cyber threats as the most significant risk to corporate reputation. The 2024/25 Reputational Risk Readiness Survey gathered responses from 500 senior executives worldwide, revealing that 65% of respondents now consider cyber attacks the primary reputational risk, up from 52% in 2023. Environmental concerns followed closely, with 64% of respondents citing them as a major risk, also increasing from 52% the previous year.
Key Findings
The survey highlights a significant shift in how businesses perceive reputational risks. Governance and social impact risks were also noted more frequently, with 56% and 47% of respondents flagging them, respectively. These increases are attributed to evolving regulatory requirements and changing stakeholder expectations across various jurisdictions.
Despite the growing concern over reputational risks, many organizations continue to weigh potential exposure against business benefits. According to the survey, 57% of executives would accept some reputational risk if the associated activity aligns with their business objectives. Most organizations (69%) assess such situations on a case-by-case basis.
Risk Management Practices
The survey also examined risk management practices among the surveyed organizations. While 94% reported having budget reserves to address reputational issues, confidence in modeling the financial impact of such events has declined. Only 11% of respondents said their organizations have strong capabilities to forecast the financial implications of a reputational event, while 64% reported moderate ability, down from 74% in 2023 and 87% in 2022.
Crisis Preparedness
Despite declining confidence in predictive modeling, organizations appear to be investing in crisis readiness. The survey found that 87% have a formal crisis response team guided by performance metrics, and 91% conduct annual drills to test their communication plans. Experts note a gap between operational readiness and analytical capabilities.
“The results show that while crisis response teams are more robust than ever, modeling capabilities still lag,” said David Bennett, head of reputational risk management at Willis. “In today’s unpredictable environment, the ability to anticipate and assess costs and liabilities is becoming increasingly critical.”
Experts recommend that companies manage reputation as an operational and financial risk rather than a branding exercise. “Leading businesses are developing strong risk management processes, including sentiment tracking and risk intelligence,” said Garret Gaughan, managing director at Willis.
