ICSA Ireland Conference 2016

125
The ICSA Ireland Conference 24 May 2016

Transcript of ICSA Ireland Conference 2016

Page 1: ICSA Ireland Conference 2016

The ICSA Ireland Conference24 May 2016

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Conference ChairConor Ryan, Chair, ICSA Ireland Branch

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To view all the slides, go to the conference webpage and click the link.

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Follow us on: @ICSA_News

Please use the hashtag #ICSAIre16

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ICSA 125Simon Osborne, Ireland conference, 24 May 2016

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125 years of leading governance

ICSA125

This October we celebrate 125 years since the institute first was first formed.

• 1891: the Institute of Secretaries

• 1971: the Institute of Chartered Secretaries and Administrators

• 2016: ICSA: The Governance Institute

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125 years of leading governance

• Positioning ourselves for the future

• ICSA: The Governance Institute

• Royal Charter to lead ‘effective governance and efficient administration of commerce, industry and public affairs’

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125 years of leading governance

Where we’re heading:

• ICSA to be the provider of products and services to support the skills and knowledge of professionals working in governance and legal and regulatory compliance roles in organisations of all types and sizes and in any sector

• A wider set of products and services, particularly qualifications, for people outside of the corporate market

• Revision of qualifications to keep them current and in demand

• Higher public profile in the media

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125 years of leading governance

How we’re getting there:

• Continued focus on raising our public profile

• Increased public profile courtesy of the Policy team, ie Code of Governance for CCGs, blogs, technical briefings, articles, speaking at events and responding to consultations

• Positioning ICSA as a thought leader in national and regional media

• Governance and Compliance magazine

• Research projects

• www.icsa.org.uk

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125 years of leading governance

Encouraging the future faces of governance:

• One to Watch, ICSA Awards

• Tom Morrison Essay Prize – the Keating twins!

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125 years of leading governance

Governance professionals are right at the heart of things, promoting accountability, transparency, integrity and stewardship to ensure that organisations operate in a manner which is most productive.

‘Governance focus has increased, the company secretary’s role has increased, [there is] more work to do, and that work is more visible.’ (The Company Secretary: Building trust through governance, Henley Business School)

The study, development and practice of governance are here to stay.

ICSA: The Governance Institute has a bright future ahead of it!

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Keynote addressPJ Timmins, Director, The Alternative Board and former CEO, Clerys plc

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Cyber security: What does it mean for your business?ICSA Conference 2016

Jared Carstensen24th May 2016

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About me…..

A|14 Jared Carstensen | 24th May 2016

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My Journey….Every kid dreams of their perfect job

Baby Firefighter Policeman Leader / Politician CISO

15 | Jared Carstensen | 24th May 2016

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Perception vs RealityBefore & After

Before Breach16 | Jared Carstensen | 24th May 2016

During & Post Breach

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Bringing the ease of an attack home…..

B|17 Jared Carstensen | 24th May 2016

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Information Security – People, Processes & TechnologyEach of us is only ever one click away!How easy is it? An example scenario of what could happen!

18 | Jared Carstensen | 24th May 2016

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Context

C|19 Jared Carstensen | 24th May 2016

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The Threat LandscapeCriminals, Hacktivists, Insiders, Nation States

20 | Jared Carstensen | 24th May 2016

This is Real – if you use the internet or send email, you are a target….▪Affecting every single person & business (viruses, malware, cybercrime etc.)

▪World Economic Forum highlights risk of cyber attack among its highest global risks

▪Over 90% large corporates (globally) have experienced incidents & attacks

▪Top 5 priority for CEO’s – FTSE 100 & FTSE 250 – Wall Street Journal

▪Breaches impact negatively on share price, consumer, people & partner confidence

▪Cyber crime makes more money than the narcotics / drugs trade and is a trulyinternational ‘borderless’ crime

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Danger Signs

D|21 Jared Carstensen | 24th May 2016

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Danger Signs for SecurityCommon mistakes that lead to failed programmes

10 | Jared Carstensen | 24th May 2016

Ineffective security programmes / departments do the following:

Χ “Why would anyone want to hack us” mind-set.Χ Treat all information and systems the same.Χ Use ‘No’ often to block projects or initiatives. Χ Apply checklist based security!Χ Drive policies as the primary way to change behaviours. Χ Try to fix all security risks with technologies and products. Χ No metrics or reporting to Audit Committee / Board.Χ Treat security as a technical area that is looked after by the IT department.Χ Inability to communicate in simple and concise business terms.

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Ensure the following….

E|11 Jared Carstensen | 24th May 2016

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Effective Security Beats ‘Good’ or Compliant SecurityFocus on the small steps to yield big changes

12 | Jared Carstensen | 24th May 2016

Effective security programmes / departments do the following:

Endorsement, mandate and comment of support from highest member of company. Prioritised and categorised list of critical services, functions and systems. Embrace organisational culture and promote positive behaviours. Make the message stick and memorable – people first / focussed approach!Ongoing reporting to Management, Audit Committee and Board.Which projects have been seen as a success, why they succeeded & replicate those. Focus on capability and enhancing maturity as opposed to purely controls based security. The best form of security is the one this is invisible to the user and has various layers. Consistently enhance practices to help prepare for incident response / breach activities.

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Final Thoughts….

F|25 Jared Carstensen | 24th May 2016

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Cyber Sales / Scaremongering – it has got to stop!Call for calm, actionable and measured steps

26 | Jared Carstensen | 24th May 2016

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Car Accidents vs Cyber Breaches!Are there similarities / comparisons?

27 | Jared Carstensen | 24th May 2016

• Rules of road to protect drivers and pedestrians• Regulations and standards to protect businesses and consumers• Speed limits depending on the type of road• Regulations depending on the type of industry and sector• Wide choice of cars available depending on your needs• Wide choice of solutions and providers depending on your requirements• By not adhering to rules and laws of the road, you put your own and others’ lives at risk• By not adhering to security rules, standards, frameworks and best practice, thousands of

incidents are happening every day putting your organization and it’s customers at risk• Despite all road safety guidelines, laws and awareness there are countless road accidents

and fatalities every day• Despite all the standards, guidance, frameworks, regulations and more solutions and

services than ever before; countless incidents, breaches and non-compliance continue

Is your organization driving recklessly, or are they simply asleep at the wheel?

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Thank you

28 | Jared Carstensen | 24th May 2016

Jared CarstensenChief Information Security Officer

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Tea and Coffee

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30

Managing Risk and ReputationNiamh Boyle, Managing Director, The Reputations Agency24th May 2016, ICSA Annual Conference

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About The Reputations Agency

31

The Reputations Agency is a full service Consumer Brand, Corporate PR and Reputation Management agency and part of Ireland’s biggest ideas company, the ddfh&b Group and the global JWT network.   Across our three divisions we tell brand stories and manage the reputations of some of the world’s biggest brands.  Using global and local insights which shape and inform our thinking, we deliver smart strategies and great ideas with a single minded focus - getting your brands and companies talked about.    We are the leading experts in reputation management in Ireland, and exclusive partners of the global Reputation Institute, with our Ireland RepTrak® Report  a calendar feature for the CEOs of many of Ireland’s best known organisations. Our TRA Brands team builds campaigns from the ground up in partnership with some of the top marketers in the country.  We are a key part of the inter-agency planning process with some of the most experienced brand experts and freshest thinkers in the country.   Our Corporate and Financial team are PR experts with strategic marketing, financial, legal and reputation management capability who act as trusted advisors to leading Irish businesses. We offer analysis, strategy, media relations and expert counsel to build profiles and engage stakeholders while also providing issues and crisis management support when organisations need it most. 

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About the Reputation Institute • Reputation Institute is the world’s leading

reputation management consultancy, founded in 1997.

• Its Global RepTrak® Pulse study is the world's largest reputation study, measuring more than 2,000 companies from 25 industries across 40 countries.

• The study provides key insights into what drives perceptions and how they influence marketplace behaviour, and powerful global benchmarking.

• RepTrak® also serves as the basis for continued thought leadership in the reputation management field.

• RI’s Reputation Leaders Network is the premier network of senior executives from more than 100 global member companies who work together to advance the practice of corporate reputation management collectively and for their organisations. 

United Arab Emirates

c

Canada

United States

Colombia

Chile

Brazil

South Africa

Australia

Malaysia

India

JapanChinaPortugal Spain

Russia

Turkey

UkraineGermany

Norway

Greece

IrelandUnited Kingdom

FranceSwitzerland

Denmark

Netherlands

Sweden

Italy

Mexico

Panama

Puerto Rico

Perú

Argentina

Knowledge Publication Conferences Training

Research Information Analysis Presentation

Advice Insight Strategy Activation

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Why should we care about reputation?

*

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Direct experience

What a company communicates

What others say

Touch Points Reputation Behaviour Business Results

A strong reputation increases supportive behaviours

and delivers positive business results

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Regulators

Media &Social Media

General Public

Employees

Customers

Key Opinion Leaders Support/

Refer

Work For/Recommend

Advocate/Refer Hold You In

High Regard

Recommend/SupportSeek Opinion

Necessary to understand your stakeholders, and how to influence them across communications touch-points, in order to drive/shape the perceptions that support your company’s results

Why should we care about reputation?

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Note: The RepTrak® Index was calculated from the daily stock market values of the 10 most reputed companies with a RepTrak® Pulse score above 70 in the UK RepTrak® Pulse rankings and adjusted each year in January. The values of the RepTrak® Index and FTSE100 Index shown are percentage changes from January 1, 2009.

Ten most highly reputed companies outperform FTSE100 Index 2009–2015Analysis of the share price of the most highly reputed companies shows that they consistently outperform the market – in the U.S., FTSE, CAC and Nordic countries.

Why should we care about reputation?

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…and there’s much more at stake!

1975 1985 1995 2005 20090%

20%

40%

60%

80%

100%

17%

32%

68%

80% 81%

83% 68% 32% 20% 19%

Components of S&P 500 Market Value

Intangible Assets Tangible Assets

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* Who you are as a Company matters more than what you Sell

Product Enterprise

38% 72%

The companies that are investing here are capturing competitive advantage

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Would buy the products 6%

Would recommend the products

Would work for

Would welcome into local community

14% 34% 56% 86%

4% 9% 26% 53% 86%

5% 11% 28% 54% 84%

7% 16% 35% 59% 86%

0-39 40-59 60-69 70-79 80+RepTrak® Pulse Score

POOR<40

AVERAGE60-69

STRONG70-79

WEAK40-59

EXCELLENT>80

* A Strong Reputation Reduces the Transaction Cost of doing Business

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* How do we know what external audiences believe about us?

Why do you love me? Do you love me? What are the practical consequences?

Defines what drives corporate reputations

Direct measurement of corporate reputation (as a proxy for trust)

Defines the consequences of corporate reputations in terms of intended behaviour

Dimensions Reputation Behaviour

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Y 2 0 1 0 Y 2 0 1 1 Y 2 0 1 2 Y 2 0 1 3 Y 2 0 1 455.00

60.00

65.00

70.00

75.00

80.00

85.00

Rep u t atio n Dev elo p men t s Th e Co c a-Co la Co mp an y

United States of America AustraliaChina Spain• RepTrak® enables a firm to see in

time negative trends in public opinion, regarding key issues like for example OBESITY

• Coca-Cola, just like McDonalds, could have seen the gradual decrease in the perceptions of the company that appeared to be linked to growing worries among external audiences regarding healthy food.

RepTrak® works as an Early Warning System

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• The company does well as a brand as it is in the Top 3 of Interbrand’s Global Ranking

• However, its reputation is substantially lower and decreasing:– Global RepTrak® 2016 - The Coca-Cola company ranks #83 – Global RepTrak® 2015: Rank #67– Global RepTrak® 2014: Rank #52– Ireland RepTrak 2016 ® - Rank #68

• As a consequence performance decreases

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74.58

78.55

RepTrak® Score Globally

All Global Pulse scores that differ by more than +/-0.9 are significantly different at the 95% confidence level. Pulse scores are based on questions measuring Trust, Admiration & Respect, Good Feeling and Overall Esteem (captured in the RepTrak ® Pulse score on a 0-100 scale).

78.98

85.41

79.19

83.19

83.34

84.77

78.95

79.29

76.64

88.33

76.19

75.19

69.80

71.26

POOR<40

AVERAGE60-69

EXCELLENT>80

STRONG70-79

WEAK40-59

BMW Group – Reputation profile across 15 markets

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RepTrak® PulseIreland 2016

79,6

78,4

77,3

76,4

76,1

75,9

75,9

75,4

75,2

75,1

74,8

74,4

74,2

73,8

73,7

73,0

72,9

72,6

72,4

72,0

71,8

71,7

71,3

71,1

71,0

70,9

70,7

70,5

69,1

68,4

68,1

68,0

68,0

67,7

67,3

67,1

66,6

66,6

66,5

66,4

65,7

65,0

64,2

63,9

63,9

63,6

63,5

63,1

63,1

63,1

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Excellent/Top tier 80+Strong/Robust 70-79Average/Moderate 60-69Weak/Vulnerable 40-59Poor/Low est tier <40

Ireland RepTrak® 2016

28 companies in the Strong tier

41 companies in the Average tier

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41 companies in the Average tier

30 companies in the Weak tier

One company in the Poor tier in 2015

RepTrak® PulseIreland 2016

62,9

62,8

62,6

62,5

62,5

62,4

62,2

62,0

62,0

61,8

61,6

61,4

61,2

61,1

61,0

60,7

60,6

60,2

60,0

59,9

59,5

59,2

59,0

59,0

58,9

58,6

58,5

58,5

58,5

58,4

58,1

58,0

58,0

57,8

57,6

56,9

56,0

55,4

54,2

54,1

53,3

52,3

51,6

48,9

47,7

46,9

46,8

46,2

44,7

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Excellent/Top tier 80+Strong/Robust 70-79Average/Moderate 60-69Weak/Vulnerable 40-59Poor/Low est tier <40

Ireland RepTrak® Pulse 2016

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Ireland RepTrak® Pulse 2016 – Ranked 75-51Ireland[sorted by 2016] 2015 2016 2015 2016

26 LloydsPharmacy - 70,9 51 Centra 67,4 62,9 -4,527 Hewlett-Packard 69,4 70,7 52 Pfizer 68,5 62,8 -5,728 Marks & Spencer Group 72,5 70,5 53 Zurich Insurance 67,1 62,6 -4,529 The Irish Times 67,1 69,1 54 Vodafone 56,7 62,5 5,930 Abbott Laboratories 67,8 68,4 55 Bus Éireann- Irish Bus 67,2 62,5 -4,731 Heineken 67,7 68,1 56 DAA 64,0 62,432 Coillte 65,9 68,0 57 Irish Life 61,2 62,233 Arnotts 74,5 68,0 -6,5 58 Iarnrod Éireann 58,1 62,0 3,934 Aviva 64,2 67,7 3,6 59 Volkswagen 77,9 62,0 -15,935 ESB 63,7 67,3 3,6 60 Sky 62,8 61,836 Primark 73,4 67,1 -6,3 61 Axa 63,0 61,637 Bord na Móna 65,6 66,6 62 Tesco 60,2 61,438 Nissan 74,2 66,6 -7,7 63 Ryanair 54,1 61,2 7,139 Apple 71,1 66,5 -4,6 64 GSK 67,3 61,1 -6,240 IBM 71,6 66,4 -5,1 65 Diageo 64,7 61,0 -3,741 Irish Distillers 63,4 65,7 66 RTÉ 65,0 60,7 -4,442 Dell 70,9 65,0 -5,9 67 KBC Bank 60,8 60,643 Laya Healthcare 61,8 64,2 68 The Coca-Cola Company 61,8 60,244 Virgin Media 51,3 63,9 12,5 69 Dublin Bus - Bus Átha Cliath 53,2 60,0 6,845 Allianz 64,5 63,9 70 PwC 56,8 59,9 3,146 Three 57,2 63,6 6,4 71 FBD 61,9 59,547 Dunnes Stores 64,6 63,5 72 Vhi Healthcare 56,0 59,2 3,148 Bord Gáis Energy 59,2 63,1 3,9 73 EY - 59,049 GAA 71,9 63,1 -8,8 74 Maxol 59,7 59,050 Independent News & Media 53,4 63,1 9,7 75 Friends First 59,2 58,9

n = 3.211 3.619 n = 3.612 3.601

2015-2016

Excellent/Top tier 80+Strong/Robust 70-79Average/Moderate 60-69Weak/Vulnerable 40-59Poor/Low est tier <40

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Ireland RepTrak® Pulse 2016 – Ranked 50-26

Excellent/Top tier 80+Strong/Robust 70-79Average/Moderate 60-69Weak/Vulnerable 40-59Poor/Low est tier <40

Ireland[sorted by 2016] 2015 2016 2015 2016

26 LloydsPharmacy - 70,9 51 Centra 67,4 62,9 -4,527 Hewlett-Packard 69,4 70,7 52 Pfizer 68,5 62,8 -5,728 Marks & Spencer Group 72,5 70,5 53 Zurich Insurance 67,1 62,6 -4,529 The Irish Times 67,1 69,1 54 Vodafone 56,7 62,5 5,930 Abbott Laboratories 67,8 68,4 55 Bus Éireann- Irish Bus 67,2 62,5 -4,731 Heineken 67,7 68,1 56 DAA 64,0 62,432 Coillte 65,9 68,0 57 Irish Life 61,2 62,233 Arnotts 74,5 68,0 -6,5 58 Iarnrod Éireann 58,1 62,0 3,934 Aviva 64,2 67,7 3,6 59 Volkswagen 77,9 62,0 -15,935 ESB 63,7 67,3 3,6 60 Sky 62,8 61,836 Primark 73,4 67,1 -6,3 61 Axa 63,0 61,637 Bord na Móna 65,6 66,6 62 Tesco 60,2 61,438 Nissan 74,2 66,6 -7,7 63 Ryanair 54,1 61,2 7,139 Apple 71,1 66,5 -4,6 64 GSK 67,3 61,1 -6,240 IBM 71,6 66,4 -5,1 65 Diageo 64,7 61,0 -3,741 Irish Distillers 63,4 65,7 66 RTÉ 65,0 60,7 -4,442 Dell 70,9 65,0 -5,9 67 KBC Bank 60,8 60,643 Laya Healthcare 61,8 64,2 68 The Coca-Cola Company 61,8 60,244 Virgin Media 51,3 63,9 12,5 69 Dublin Bus - Bus Átha Cliath 53,2 60,0 6,845 Allianz 64,5 63,9 70 PwC 56,8 59,9 3,146 Three 57,2 63,6 6,4 71 FBD 61,9 59,547 Dunnes Stores 64,6 63,5 72 Vhi Healthcare 56,0 59,2 3,148 Bord Gáis Energy 59,2 63,1 3,9 73 EY - 59,049 GAA 71,9 63,1 -8,8 74 Maxol 59,7 59,050 Independent News & Media 53,4 63,1 9,7 75 Friends First 59,2 58,9

n = 3.211 3.619 n = 3.612 3.601

2015-2016

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Ireland RepTrak® Pulse 2016 – Ranked 25-11

Excellent/Top tier 80+Strong/Robust 70-79Average/Moderate 60-69Weak/Vulnerable 40-59Poor/Low est tier <40

Ireland[sorted by 2016] 2015 2016

1 Bord Bía 79,8 79,62 Eason & Son 72,8 78,4 5,6 Bord Bía3 An Post 75,3 77,3

5 Lidl 72,9 76,1 3,26 The Irish League of Credit Unions 77,6 75,97 Aldi Stores 72,9 75,9 Irish Water8 BMW 71,8 75,4 3,69 Ford 72,7 75,210 Boots 81,6 75,1 -6,511 SuperValu 71,4 74,8 3,4 Biggest climb 201612 Intel 74,9 74,4 Virgin Media13 Toyota 76,3 74,214 Kellogg's 81,0 73,8 -7,215 Glanbia 70,5 73,7 3,216 Cadbury 73,5 73,0 Biggest fall 2016 -15,917 Tourism Ireland 73,8 72,9 Volkswagen18 Aer Lingus 74,9 72,619 Smyths Toys 75,5 72,420 Kerry Group 70,4 72,021 Applegreen - 71,822 Microsoft 74,7 71,723 IRFU 77,6 71,3 -6,224 Brown Thomas Group 71,3 71,125 Spar 66,4 71,0 4,6

n = 3.015 3.702

Ireland[sorted by 2016] 2015 2016

1 Bord Bía 79,8 79,6 Highest score 20162 Eason & Son 72,8 78,4 5,6 Bord Bía3 An Post 75,3 77,3

5 Lidl 72,9 76,1 3,26 The Irish League of Credit Unions 77,6 75,97 Aldi Stores 72,9 75,9 Irish Water8 BMW 71,8 75,4 3,69 Ford 72,7 75,210 Boots 81,6 75,1 -6,511 SuperValu 71,4 74,8 3,412 Intel 74,9 74,4 Virgin Media13 Toyota 76,3 74,214 Kellogg's 81,0 73,8 -7,215 Glanbia 70,5 73,7 3,216 Cadbury 73,5 73,017 Tourism Ireland 73,8 72,9 Volkswagen18 Aer Lingus 74,9 72,619 Smyths Toys 75,5 72,420 Kerry Group 70,4 72,021 Applegreen - 71,822 Microsoft 74,7 71,723 IRFU 77,6 71,3 -6,224 Brown Thomas Group 71,3 71,125 Spar 66,4 71,0 4,6

n = 3.015 3.702

2015-2016

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Ireland RepTrak® Pulse 2016 – Ranked 10-1

Excellent/Top tier 80+Strong/Robust 70-79Average/Moderate 60-69Weak/Vulnerable 40-59Poor/Low est tier <40

Ireland[sorted by 2016] 2015 2016

1 Bord Bía 79,8 79,6 Highest score 20162 Eason & Son 72,8 78,4 5,6 Bord Bía3 An Post 75,3 77,34 Google 84,4 76,4 -8,05 Lidl 72,9 76,1 3,26 The Irish League of Credit Unions 77,6 75,9 Lowest score 20167 Aldi Stores 72,9 75,9 Irish Water8 BMW 71,8 75,4 3,69 Ford 72,7 75,210 Boots 81,6 75,1 -6,511 SuperValu 71,4 74,8 3,412 Intel 74,9 74,4 Virgin Media13 Toyota 76,3 74,214 Kellogg's 81,0 73,8 -7,215 Glanbia 70,5 73,7 3,216 Cadbury 73,5 73,017 Tourism Ireland 73,8 72,9 Volkswagen18 Aer Lingus 74,9 72,619 Smyths Toys 75,5 72,420 Kerry Group 70,4 72,021 Applegreen - 71,822 Microsoft 74,7 71,723 IRFU 77,6 71,3 -6,224 Brown Thomas Group 71,3 71,125 Spar 66,4 71,0 4,6

n = 3.015 3.702

RepTrak® Pulse development2015-2016

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52Ireland RepTrak® 2016 - Industry ranking

Ireland Average Pulse 63.6

Food - Manufacturing (4) n = 401

Retail - General (11) n = 1.701

Computer (6) n = 606

Automotive (6) n = 603

Public Services (5) n = 602

Pharmaceuticals (5) n = 502

Information & Media (6) n = 707

Energy (7) n = 1.406

Retail - Food (5) n = 899

Transport & Logistics (5) n = 799

Beverage (5) n = 1.000

Financial - Insurance (11) n = 1.099

Services (6) n = 1.102

Telecommunications (7) n = 604

Financial - Bank (7) n = 1.699

Total n= 13.732

Ireland

73.1

69.1

64.8

63.9

63.4

62.4

58.7

55.8

71.7

68.5

64.1

63.5

63.2

61.5

57.1

63.2

73.171.7

69.168.5

64.864.163.963.563.4

62.461.5

58.757.155.8

0 20 40 60 80 100

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Reputational Risk Management

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54

1978 1984 2001

The topic is not at all new…

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20101989

…and the Energy/Petrochemical industry has seen some major incidents

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The difference between then and now is extremely different – Impacts today are immediate and global…

TodayYesterday

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57For BP, the Deep Water Horizon incident had a devastating impact on their reputation – and consequently their financial performance

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HOW VW LOST THE PUBLIC’S TRUSTSeptember 2015 - US EPA announced Volkswagen had been installing sophisticated software to cheat diesel emission tests - Volkswagen’s cars were environmentally friendly no more. The general public’s trust in the automaker was highly damaged in the US as well as globally.

Country Q1 RepTrak® Pulse

Q4 RepTrak® Pulse

Δ RepTrak® Pulse

UK 82.7 52.8 -29.9

SPAIN 74.8 47.1 -27.7

ITALY 77.9 52.2 -25.7

FRANCE 76.1 51.3 -24.8

GERMANY 80.6 57.1 -23.5

US 69.7 61.0 -8.7

VW RepTrak® Pulse in Germany and VOW.DE Stock Price: Q1 2015 through January 2016

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59Crisis hits your reputation harder if your reputation is already weak. Be aware of industry belonging!

RepTrak® Pulse

Score 40-59 70-7960-69

Reputation Loss post a negative

event - 15 - 11 - 6

CRISIS AND REPUTATION

Industry

Reputation Loss post a negative

event - 23 - 8 - 6

CRISIS AND INDUSTRY

Banking Consumer Goods

Pharma

1

2

3

4

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60Reputation risk and how to manage it

…That impacts stakeholders’ perception and

behaviour…

A reputation risk is a potential negative event…

What it is

…and ultimately impacts on business results

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ExerciseTake two minutes to jot down

the reputational risks to your business

List the top five....

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64Managing reputation risk

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Perception

- 13,3

- 25,7Max loss on reputation score in case of risk

1

2

3

4

What is more at stake in case of risks?

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1 Accounting malpractices

2 Bankruptcy fraud

3 CEO resignation after a financial scandal

4 Child labor in a supplier's factory

5 Delayed reporting of defects

6 Fraud and abuse allegations

7 Homophobic comments of top management

8 Incoherent communication of corporate strategy

9 Labor strike in emerging market

10 Mandatory product recall

11 NGOs very critical against a plant

12 Price increase

13 Product fraud

14 Bribery of Public officials

15 Repeated product recalls

16 Service changes and interruption

17 Sexual harassment

18 Strong layoffs

19 Unaware utilization of toxic packaging

20 Wage Renegotiation

The top 20 reputation risks Every company needs to monitor

How many of you are

monitoring these risks?

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The process that tracks PROGRESS and provides input to the

organisationover time

The factor that describes how likely it is that

the RISK will materialize and how

it will impact stakeholder perceptions &

support

3. Monitoring1. Impact 2. Readiness

The factor that defines how PREPARED the

company is to identify, mitigate and

respond to a crisis

MITIGATION

Reputational Risk – Three key variables need management

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68Risk Register

Template - Risk Register

No. Description of Risk Area/Division Risk Type Impact Likelihood Control rating Risk Score Planned Response Mitigation/controls Risk Owner

 

Summary of Risks: X = Low Y = Medium Z = High

   

1 = minor 2 = significant 3 = v significant

1 = may occur 2 = likely 3 = very likely

1 = fully under control 2 = somewhat controlled 3 = poor/inability to control

1 -4 = Low 5-11 = Medium 12-27 = High red alert

     

                     

                     

                     

                     

                     

                     

                     

                     

                     

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Risk Readiness - five steps

1.…identify reputation risks

2.…predict potential damage

3.…responsibility is clear

4.…crisis management plans are well defined  

5.…reputation embedded in company culture

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Niamh Boyle, Managing DirectorOffice: +353 1 661 [email protected] Reputations Agency, 25 Merrion Square, Dublin 2

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Dennis TourishProfessor of LeadershipRoyal Holloway, University of LondonCo-editor of ‘Leadership’Email: [email protected]

DYSFUNCTIONAL LEADERSHIP IN CORPORATIONS

Ken LayAKA ‘Kenny Boy’

Jeffrey Skilling

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Amazon May 2016- 163253 books with ‘Leadership’ in their title. If you read one every day including weekends it would take you 447 years….

BUT – there are only346 books with ‘Followership’ in their title We have a fixation on leadership, though without followers there are no leaders…

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SOME ASSUMPTIONS• Followers should

conform – mostly, do what they are told

• Leaders know best (but do they always?)• Dissent is resistance

to be overcomeWho’s the bossBBC 2March 2016

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INVOLVEMENT… AND POWER

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INVOLVEMENT… AND POWER

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A MAJOR SOURCE

OF ERROR???‘The temptation to tell a Chief in a great position the things he most likes to hear is one of the commonest explanations of mistaken policy. Thus the outlook of the leader on whose decision fateful events depend is usually far more sanguine than the brutal facts admit.’

 Winston Churchill (1931) INGRATIATION...

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EFFECTS OF FLATTERY• A study of 451 CEOs looked at the impact on them of

more intense and frequent flattery (e.g., offering exaggerated compliments) and opinion conformity (e.g., expression of agreement even when people don't agree).• Flattery and opinion conformity linked to CEOs having more favourable evaluations of their own strategic judgments and leadership skills, being less likely to make strategic changes when firm performance suffered, and more prone to lead firms that suffered persistently poor performance.

Hyuan Park, Westphal and Stern, ASQ, 2011

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EFFECTS OF NARCISSISM• Highly narcissistic CEOs less responsive to

whether recent firm performance was good or bad - continued to make equally risky investments (e.g. acquisitions of new companies) regardless of recent performance. Their less narcissistic peers more cautious in bad times and tended to take bigger risks during good times.

Chatterjee and Hambrick, ASQ, 2011

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EFFECTS OF NARCISSISM• Less narcissistic CEO's weren’t affected

much by media praise. The highly narcissistic made riskier investments after getting praised in the media. The narcissists were swayed more by "social praise" and less by recent performance!

• ‘The only benefit of flattery is that by hearing what we are not, we may be instructed what we ought to be.’

Jonathan Swift

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IRRATIONAL BIAS– ILLUSORY SUPERIORITY

• 69% of drivers consciously worry about being killed when driving

• Only 1% believe they drive worse than average

• 98% think they are safer than, or as safe, as the average driver. Brake (Road Safety Charity) Survey of 800 UK adults, March 2011

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‘Have you ever noticed that anybody driving slower than you is an idiot, and anyone going faster than you is a maniac?’ George Carlin

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PROBLEMS WITH FEEDBACK

People are especially sensitive to negative input – the ‘automatic vigilance effect’

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WHAT CAN BE DONE?

• Seek out formal and informal contact with people as often as possible

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A CLIMATE WHERE THE

TRUTH IS HEARDEngage in debate, not coercion• Have chaotic meetings• Loud debate• Heated discussions• Healthy conflict

[email protected]

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Career development for company secretariesValerie Teller, Switched On CoachingWith Conor Ryan FCIS, President, ICSA Ireland

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Outline for this session

1. What are your long-term career aspirations?

2. How do you raise your profile?

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1 | What are your long-term career aspirations?

• What do you really want?

• What is important to you?

• When you are 95, what will you want to say about your life?

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2 | How do you raise your profile?

From their perspective…• When it comes to your career,

who are your stakeholders?

• What’s important to them?

• How can/do you make their jobs easier?

From your perspective…• What is it that you see/know

about your organisation that others don’t?

• What is important about what you do?

• How does the co sec function add value to your organisation?

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2 | How do you raise your profile?

A few tips• Create opportunities by creating connections

• Stretch your comfort zone – it’s like a muscle

• Get support

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2 | How do you raise your profile?

BE CURIOUS

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Career development for company secretaries

What will you take away from today’s session?

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Thank you

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Risk Culture and Risk Culture InspectionsICSA Conference 2016

24th May 2016

Mark Burke Chief Risk & Compliance Officer, Mediolanum Ireland

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Agenda

Background & Context

What do regulatory authorities mean by culture?

Drivers of Culture in a firm

Conclusion

Indicators of a sound risk culture

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What has brought about this focus on culture?

108

Global Financial Crisis

Legalistic approach to point-of-sale disclosure

Sufficient awareness of clients behavioural biases?

How to safeguard rather that inadvertently profit from these?

Prevailing view that weakness in culture at the heart of the financial crisis

Is point-of-sale material there to protect the company or inform the customer?

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Agenda

What do regulatory authorities mean by culture?

Background & Context

Drivers of Culture in a firm

Conclusion

Indicators of a sound risk culture

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What do regulatory authorities mean by culture?

Culture is like DNA: it shapes judgements, ethics and behaviours that matter to the reputation and performance of the business

It shapes the service provided to customers and clients

An effective culture is one that supports:

• the fair treatment of customers, and

• Promotes sound risk taking and risk aware decisions throughout the business

Examine culture though the lens of doing the right thing

Ownership and responsibility for ensuring risk aware and client focussed outcomes rests with each and every employee and should not be seen as something that can be delegated to the risk & compliance functions

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Agenda

Drivers of Culture in a firm

What do regulatory authorities mean by culture?

Background & Context

Conclusion

Indicators of a sound risk culture

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Drivers of Culture at a firm

Examine culture through the lens of doing the right thing whether from a risk or conduct perspective

- Strong Corporate Governance

- Setting the tone from the top

- Translating this into easily understood business practices through values such as accountability and ensuring effective communication and challenge

- Supporting the right behaviours through performance management, employee development and reinforcing these through reward programmes

The responsibility for ensuring the right outcomes resides with everyone at the firm, led by senior management, and not something delegated to compliance or control functions

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Agenda

Indicators of a sound risk culture

What do regulatory authorities mean by culture?

Drivers of Culture in a firm

Conclusion

Background & Context

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• Succession planning processes for key positions

• Focus on financial and non-financial incentives

• Job rotation between control functions and

business lines

Incentives and Behaviours

Tone from the Top

Accountability

Effective Communication & Challenge

• Board Ownership of Strategy

• Alignment of Strategy with Core Values

• Leading by example

• Learning from mistakes

• Ownership by the front line

• Common understanding and awareness at all levels

• Clear escalation processes to support risk management

• Consequences are clearly established

• Established mechanisms to facilitate communication and

• Bring alternate views to the decision making process

• Risk function seen as a genuine business partner

• Ongoing training on the institution’s desired behaviours

Indicators of a sound risk culture

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Agenda

Conclusion

What do regulatory authorities mean by culture?

Drivers of Culture in a firm

Background & Context

Indicators of a sound risk culture

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Key Takeaways

• Greater awareness of the importance of culture in driving key behaviours in firms

• Having a framework to demonstrate the various mechanisms in place to• Monitor,• Shape, and• Influence the culture within the firm over time…

to deliver risk aware decision making and good consumer outcomes.

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Sports governanceJim Boyce, former Vice President, FIFA

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ODCE and the Companies Act

One Year on

Kevin PrendergastHead of Enforcement, ODCE

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ODCE Impacts In insolvency

Offering restriction undertakings to remove the need for High Court proceedings

Power to wind up companies in public interest – none to date

In examinership ODCE must get copy of report to the Court – small

number to date

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ODCE Impacts

In enforcement Auditors must report offence of financial statements

failing to give a true and fair view – no reports to date – preparing guidance for auditors

Directors’ loans can be validated by new Summary Approvals Procedure – have found one example of this being undertaken

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Other judicial developments Significant Court of Appeal judgement

DCE v Walsh & Ors, disqualification action by the Office under what was s160(2)(h) CA 1990, now s842(h) CA 2014, company struck off with debts owing

High Court declined to disqualify on basis of general economic downturn, lack of qualifications of directors, scale of enterprise, past behaviour

Court of Appeal judgement in January 2016

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Other judicial developments Key aspects of judgement

“Financial maelstrom” does not change nature of the law

Scale of enterprise and qualifications of directors are irrelevant

Other past behaviour irrelevant Passive directors cannot be exonerated on that basis,

all director expected to take steps to secure compliance

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Thank You

Further Information is available fromwww. odce. ie

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Panel discussion: The Companies Act – one year on

Conor Sweeney, CLS Chartered SecretariesMaureen O’Sullivan, Registrar of CompaniesKevin Prendergast, ODCERuairi Cosgrove, PwCSal Nash, KPMG