A consortium led by UK top 50 law firm Kennedys has been awarded £783,000 in funding from Innovate UK to develop software that is able to identify and assess reputational risk, as part of a £1.2m project. The difference will be covered by Kennedys and four fellow consortium members: The University of Manchester and University College London; public relations group Cicero/amo; and risk management company RiskCovered Limited.
Reputation Advisor will be developed to analyse content – from corporate documents to publicly available information – to create a reputational index of risk relating to an organisation’s corporate citizenship via ESG (environmental, social and governance) practices that impact on a company’s bottom line.
While reputation risk is broader than ESG mandates, the consortium says that it has chosen to focus on ESG in the recognition of the fact that ESG considerations are increasingly influential in private and public investment, as well as consumer-spending decisions. Sustainable supply chains, carbon footprints, charitable giving and the development of diversity and inclusion metrics are all topics of increased scrutiny by the public and regulators.
Reputation risk is considered as an intangible asset that is rising in company value. Karim Derrick, product and innovation director for Kennedys’ tech arm Kennedys IQ said: “In a world where companies are often accused of greenwashing, Reputation Advisor will also provide robust and transparent evidence of a firm’s genuine green credentials. From an insurance perspective, the product will help insurers in their conversations with their own clients to quantify ESG related risk.”