They’re all connected
Risk management is most successful when the regulatory authorities and their stakeholders trust that they can count on each other. When you’re the regulator, your reputation not only precedes you but can also determine how successful you are in achieving your objectives.
Reputation is what other people believe to be true about you. Reputation is built over time by walking your talk. Eventually (ideally) your stakeholders know they can count on you to perform what they think is your role. If you fail to meet those expectations, your reputation suffers. Trust goes down and regulation becomes less effective.
Trust essential for reliable stakeholder reporting
If citizens want to continue to live in countries that are peaceful and well governed they must have a level of trust that would lead them to report something that they know to be wrong. This is an inescapable conclusion of a CBC Fifth Estate documentary on the police break-up of a terrorist cell that plotted to kidnap politicians and blow up buildings in Toronto last year. As much as the show is about what was planned, it’s also about the role of the informant, without whom the police could not have done their work.
Regulation often functions on the basis of reliable third party reports–either from reporting agencies/organizations or citizens. And regulation often fails when the reports are unreliable or when no one will come forward.
Consider these examples:
- Youth who witness crimes and won’t come forward because of fear–the reality on the street leads them to believe that they will be in danger if they report (they don’t trust police statements that suggest they will be protected)
- The cynicism of some professionals who freely talk about what really goes on in the profession that’s plainly wrong. They’re often cynical about the regulator because they see no evidence that the regulator knows what’s happening. These individuals enable activities that disgust them by being quiet. Their silence undermines the profession that’s their livelihood.
Reframe difficult situations
Regulators can reframe difficult situations involving trust, raise the bar, and help themselves by using the expectation principle. Work that two colleagues, Kate Erickson and Connie McCandless, are doing with high performance teams and individuals speaks to the need for teams to be intolerant of activities, attitudes and language that bring the team down. Reframing a situation to create an expectation of excellence is a powerful technique, summed up in the expression “It’s what you expect, not what you inspect, that counts.”
Build trust on the inside first
Another colleague, Chris Ward, whose specialty is reputation management, offers these suggestions:
- Check out your reputation among the members of your own (internal) team. It will be difficult, if not impossible, to influence your external reputation if team members lack trust in your ability, willingness or performance as a regulator.
- Obtain a clear picture of the risks in your jurisdiction and what your stakeholders trust and expect you will do to deal with them.
- Develop proactive and reactive strategies for dealing with issues that could compromise your reputation, as well as opportunities that could have a significant and positive impact on the way your organization is perceived.
- Check to see that your strategies and methods for creating visibility are consistent with building trust.
Risk management is at the heart of what regulation is all about. Your reputation, which is built on a foundation of trust, is a critically important element of your risk management strategy.