More families, family offices and family businesses are starting to put in place sophisticated solutions to monitor their reputational risk.

In this article, we answer some of the top questions that families, family offices and family businesses ask about how these services work in practice.

Why do families need reputation risk monitoring?

There is a huge amount of information published online, not only on online publications but on blogs and social media as well. The scale is truly astounding. To quote a few examples: more than 4.3 billion messages are posted on Facebook every day and more than 682 million tweets are posted on Twitter every day.

The sheer scale of this information means that there will inevitably be information posted online that presents reputational risks to every family, whether that comes from a customer, employee, business partner or otherwise. We have seen time and again that big reputational crises start from very small pieces of information finding themselves online, which slowly gather more and more speed.

In Transmission Private, we call this phenomenon 'waterfalling'; that is, crises usually start from a small issue or challenge, which gradually gathers more and more interest and momentum, until it becomes an almighty crash. It is like a water droplet gathering speed as it descends a waterfall. The idea behind reputation risk monitoring is to catch the issue as far up the waterfall as possible so that you can either fix misinformation or take corrective measures.

What's the biggest misconception about reputation risk monitoring?

The biggest misconception by far is that risk monitoring is only required by families or individuals who have clear and obvious reputation risks, such as being involved in a controversial industry or having something specific that they might want to keep private. This is not the case at all.

Over the last few years, we have found that all families are increasingly subject to unfair and sometimes politicised public attacks, regardless of their good intentions. We have also found that data and information are sometimes twisted into attacks on a family that they may not have considered or conceived. We have also found that business owners are increasingly becoming subject to disinformation campaigns, which can quickly spiral out of control.

Additionally, even if families are not subject to direct attacks, we have found that well-intentioned friends and other members of the family—especially younger members—sometimes inadvertently post too much online, which risks jeopardising the family's privacy.

What does risk monitoring look like?

In short, reputation risk monitoring amounts to leveraging a combination of cutting-edge technology and human intelligence to monitor references to the family's members, associates, companies, investments, charities, other organisations, trends and much else besides online and offline that could pose a risk to the family's reputation.

Importantly, this monitoring must go beyond tracking new content. It must also include monitoring changes to existing content which is relevant to the family.

It blends the following competencies:

• Cutting-edge technology which digests all the new online content—from social media to newspapers—in as close to real-time as possible to automatically detect mentions of the family.
• A team of expert communications professionals who then manually assess these mentions to evaluate whether they poses any risk to the family.

What is a reputational risk?

It is difficult to pin down a single, simple definition of 'reputation risk'. In its widest possible sense, it is anything that could end up posing a risk to the family. When assessing and evaluating risks it is important to err on the side of being cautious and also think carefully about how something might be perceived in the fullness of time, even if it may not pose an imminent, short-term risk to the family.

At Transmission Private, we tend to put risks into two rough, broad groups, although there are many shades between the two—and, in fact, usually a true reputational risk is a combination of these two things together:

• Critical material. Unfounded or not, this is anything that subjects the family to criticism, whether it's their investments; the results of a legal case; allegations around employment practices; comments about the family's approaches to philanthropy, sustainability, tax structuring or something else entirely. These risks usually start with a former employee, customer, or outside individual criticising a family for undertaking (or supposedly undertaking) some action.
• Material not already in the public domain. This is anything that finds itself onto the Internet or in the media that the family previously thought was private. Importantly, on its own, this may not be especially negative but, instead, could be a previously unreported business deal; photographs of the family on holiday, or information about where the family lives.

How do you monitor the media in the age of online?

In the past, it was possible to literally read every new piece of news: there were a small number of national, regional and trade publications, and there were teams of people whose job it was to read these newspapers cover to cover, and flag mentions to companies or individuals every morning. This was the case as recently as the 1980s and, in fact, a number of these manual reading teams still exist today.

However, the scale of the content that is produced today means that is no longer possible. Instead, you need to use software that digests all the new, fresh content that is published on the web as close as real-time as possible. This software acts as a sieve—capturing any content that mentions an individual, company or another key term. This software still returns a huge number of results, most of which will be irrelevant.

At that point, the software hands over to a team of humans; they are responsible for manually reading and assessing the mentions to understand why they have been picked up and, then, make an assessment as to whether they are both relevant and pose a risk to the family. However, the real difficulty is that there are multiple streams of new content: blogs, Twitter, Facebook, LinkedIn, public filings, etcetera, and each of these streams usually needs its own bespoke software solution for monitoring. It's not so much a single sieve as a number of separate sieves, which then funnel all these mentions into a single pooling point for human analysis.

This is even further complicated in the case of private clients, as there are channels that expose private clients to risk—such as photographs on stock image websites or Instagram—that do not generally pose a risk to companies; as a result, a bespoke solution is needed that takes all of this into account.

One thing that is often missed is that it is insufficient to simply monitor the Internet for new mentions of a family or one of their companies; if there is content that is online about either, then this content also has to be monitored for changes. In the case of an old news story, this might be the addition of a comment below the article which could revive an old story and present a new risk.

Why is social media an important stream of reputational risk?

As well as generating more content than ever before, the Internet has also turned everyone into a publisher: if you are unhappy, have an opinion you want to express, or want to share your perspective on a topic, it has never been easier. Off the back of this, over the last 5 years, we have seen activists turn to social media as a tool for criticising families and business owners.

Additionally, there has been an increasing trend towards big national press and media stories starting on social media, even from just one or two comments. We have also seen that many younger family members, who have grown up as digital natives and are very comfortable with sharing information about themselves, inadvertently 'overshare' and pose a reputational risk to the family.

One of the final difficulties that families may face is that Facebook—the largest social network globally—is a closed platform; this is unlike Twitter, where the vast majority of content is published openly and publically. In fact, you cannot see and monitor the content that is on Facebook unless you log in, which makes it significantly more difficult to track.

What other sources of information could pose a risk?

There are quite literally hundreds of sources of information that could pose a risk to a family; in short, if it is feasible that a family member or one of their companies could be mentioned on that stream of information at some point in the indefinite future, then it could pose a reputational risk. All of these have to be monitored around the clock.

A non-comprehensive list of sources include:

• Public filings, such as company records or stock exchange notices
• Legal records
• Data and financial leaks
• Aircraft and yacht registers
• Video websites, including YouTube
• Stock photography websites
• Land Registry
• Website domain ownership records

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