In an environment where corporate visibility is often equated with success, Jorge Del Castillo, managing director at FTI Consulting, sees a deeper issue.
“Many companies invest millions in building visually appealing brands… but neglect reputation management,” he said. For Del Castillo, this gap is not just a communications problem – it’s a risk management failure.
"Reputation is one of the most undervalued and under-measured sources of competitive advantage," Del Castillo said. “Many companies fail not because of weak technology, infrastructure or operations, but because they did not have a solid trust strategy when they needed it most.”
While branding focuses on recognition and visibility, Del Castillo stressed that reputation is about trust, legitimacy and resilience.
“Brand and reputation are essential intangible assets, but they play different roles,” he said. “A strong brand is measured by popularity, not necessarily trust or legitimacy.” That distinction, he argued, has direct consequences for corporate risk exposure.
Reputation affects a company’s ability to attract investment, engage stakeholders, retain customers and avoid regulatory issues. “What really sustains growth is reputation,” he said. “While less visible and harder to measure, its impact is evident over time.”
Del Castillo observed that companies often conflate the two concepts, assuming one covers the other.
“It is tempting to assume that a strong brand equals a strong reputation, but this is not always the case,” he said. “Building a brand without reputation management is like putting lights on a building without a foundation: it looks good, but it can collapse at the slightest tremor.”
In his view, the root of the imbalance lies in short-term pressures and an overemphasis on visual appeal.
“A successful marketing campaign can bring fast users, press and positive feedback in networks,” he said. “It is not uncommon to see companies obsessed with growing fast and being visible assuming that user trust will come by itself.”
For risk professionals, this mindset presents a challenge. Without a clear reputation strategy, Del Castillo warned, organisations leave themselves open to vulnerabilities that can’t be mitigated through branding alone. “A high level of visibility can hide deep reputational cracks.”
This is particularly important given the scale of value tied to intangible assets.
“Between 70% and 80% of the market value of companies comes from intangible assets such as brand and reputation,” he said. “In other words, most of a company’s value lives in the minds of its stakeholders.”
From a risk management standpoint, this means reputation should be measured and monitored as rigorously as financial performance.
“Just as no one would leave financial health unmonitored, reputational health deserves rigorous, continuous and strategic monitoring,” Del Castillo said.
“At FTI Consulting we created a comprehensive model to evaluate and manage corporate reputation, backed by years of global experience in the field,” he said. The approach includes reputation key performance indicators (KPIs), coupled with qualitative, quantitative and digital methodologies.
“In practice, this means that we can quantify that intangible called reputation, but, more importantly, break it down into actionable elements.”
These elements include internal and external perceptions, from customers to industry peers. “With this holistic analysis, it is possible to detect hidden risks, identify opportunities for improvement and design tailored strategies to strengthen trust in the company.”
According to Del Castillo, reputation assessments can also highlight where the company’s narrative may not align with stakeholder perceptions. “Measuring only the ‘top of mind’ leaves out what is most important: the quality of the bond, trust and coherence between speech and action.”
The risks of ignoring reputation are not hypothetical. Del Castillo pointed to findings that illustrate the consequences of inaction.
“A crisis of trust can destroy in days what has been built over years,” he said. “A recent study by Mastercard showed that 60% of consumers would stop trusting a financial provider after a serious security or service failure.”
Despite this, he said, “only 42% of companies in the industry prioritise security and data transparency despite recognising the importance of trustworthiness.”
This disconnect, he argued, is a prime example of how companies underestimate reputational risk – an oversight with real consequences.
“The consequences of a bad reputation range from loss of customers to difficulties in attracting talent and investment. In extreme cases, it can trigger regulatory sanctions or even the collapse of the business.”
Del Castillo believes that effective risk management today requires a broader lens – one that recognises intangible exposures.
“When a company understands what its stakeholders, including regulators, government and community, expect of it, it is in a better position to build legitimate arguments that allow it to operate in any environment.”
He maintained that measuring reputation on a regular basis is “not a luxury, but an imperative.” For risk managers, the ability to anticipate issues before they escalate is a fundamental advantage.
“Companies that understand their reputational profile can anticipate threats, prioritise internal improvements and build long-term relationships with their key audiences,” he said.
In moments of crisis, that preparation can determine outcomes.
“An actively managed reputation often translates into greater resilience: when faced with a problem, those with a good reputation receive the benefit of the doubt and the support of their stakeholders, while those who have neglected their reputation face the storm alone,” he said.
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