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A WORLD OF DANGERunderestimated. A global broker should also be considered to bring a localtripartite relationship together to ease the resolution of issues.REPUTATIONAL RISKSReputational risk too has grown in importance. In a 2011 report from theFinancial Reporting Council (FRC), Boards and Risk, participants from majorcompanies did not consider reputational risk to be a separate category, but aconsequence of failure to manageother risks successfully. But theBy taking a systematicreport notes that the ‘grace period’approach to managingthat a company has to deal with a business risk, manyproblem before it becomesmore UK businessesreputationally – and subsequently can build a stable,financially – damaging, has been successful futuresharply reduced. Developments inmedia and communications, including social networking, mean that news offailures or problems now often has an almost instantaneous impact locally andinternationally.RISKS CAN BE MANAGEDThe ‘bottom line’ for businesses is that all of these risks are both identifiableand manageable. Through ‘gap analysis’ you can identify risks that needmitigating. For those risks that you feel you cannot retain, the next step is toconsider transferring them. Some may be passed to suppliers, customers orsub-contractors through legal and contractual arrangements, while for othersrisk transfer will involve the purchase of insurance.The need to develop robust risk management strategies is evident. Usedeffectively, they enable businesses to identify many potential threats and toimplement plans for mitigation. They also help to reduce costs and insurancepremiums. By taking a systematic approach to identifying, managing andexploiting risk, many more UK businesses can build a stable, successful future.11