Losing your reputation

The ultimate risk for a public institution

Totonto street car on dedicated path

A recent strike by Toronto Transit Commission workers presents an interesting case demonstrating how unexpected behaviour can swiftly damage reputation.

From sigh of relief to gasp of disbelief

Last week, city of Toronto residents, collectively, took a huge sigh of relief. The city and union officials, representing the Toronto Transit Commission (TTC) workers, had just negotiated a deal that promised to advert a crippling strike.

Granted, the deal had to be ratified by the union executive and accepted by members. However, given that the deal seemed generous, and that negotiations seemed long and arduous, most residents did not expect a strike. Union spokespersons had also made it clear that any possible strike would be preceded by 48 hours of notice.

So when transit workers walked off the job on Friday evening (April 25th 2008), without notice, creating havoc for thousands of people whose plans depended on the service, the collective sigh of relief became a gasp of disbelief. A diverse mixture of views and emotions about TTC workers, union leadership, and city officials got thrown into a public pot that started to brew early Saturday morning.

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Reputation, trust and risk management

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. Continue reading