Loading Logo

From links with Russia to executive pay: the new risks to your digital profile

May 2022
 by Davina Thiara

From links with Russia to executive pay: the new risks to your digital profile

May 2022
 By Davina Thiara

More than ever, the lives of individuals in the public eye and senior executives of large and public businesses are facing scrutiny from journalists and citizen activists. Those concerned are being exposed to ever-evolving risks through their publicly-available online profiles. It has never been so easy for journalists to generate a comprehensive picture of an individual of interest to them, and use the information they collect in ways that may incite reputational damage.

Privacy violations can be difficult to manage, control or even predict. Even when a company or executive’s own behaviour is unblemished, their image can be discredited simply by association with others whose actions or views may be exposed as more questionable.

While specific activity is hard to predict, there are clear trends emerging, influenced by the current external environment, that can help us to determine the level of risk to an individual or company of antagonistic reporting:

Executive remuneration

Executive remuneration has always triggered heated debate, and journalists are quick to make use of this in their reporting, particularly when remuneration is poorly aligned with company performance. A recent poll for the High Pay Centre report found the public believes the income gap is too large: 63 per cent of Britons felt chief executives should be paid no more than 10 times the earnings of lower or mid-ranking employees. Pay rises for Manchester Airports Group bosses during the recent pandemic were met with outrage at a time when many staff were having to take pay cuts and some had lost their jobs. However, some executives showed solidarity with employees by taking pay cuts themselves during the pandemic, including Rentokil CEO Andy Ransom who reduced his pay by 35 per cent and donated the rest to an employee fund.

Although the worst of the pandemic may be behind us, we now face a cost of living crisis that is seriously impacting the lives of millions. As this crisis dominates the headlines, executive remuneration is again becoming a political topic, with negative attention on executive pay packages often resulting in scrutiny of the personal lives of those concerned. Senior figures of high-profile companies are coming under the microscope once again.

For companies and executives at risk of negative press and scapegoating, there are steps that can be taken to reduce the chance of being targeted. Limiting access to personal information online, and ensuring content that could be used to conjure a picture of a “lavish lifestyle” is kept private, will help to maintain discretion and security. This extends to the online profiles of family members and close friends, and information about private residences and other assets. Such information can be easily accessible to individuals with the know-how, and is frequently exploited by reporters decrying inequality within large corporations.

Links with Russia

Since the Russian invasion of Ukraine began, the media has been quick to uncover and highlight any links and ties with Russia held by high-net-worth individuals (HNWIs) and companies, leading negative press for those affected. In April 2022, Rishi Sunak’s wife Akshata Murthy came under fire following claims that Indian IT giant Infosys, in which she holds a £400m stake, was still operating in Russia.

Akshata Murthy has also recently suffered negative press due to her non-domiciled status for UK tax purposes, which many saw as problematic in light of her husband’s role as chancellor. Although her non-dom status is completely within the law because of her Indian citizenship, the revelation added fuel to the fire for those who believe high earners tend to find ways to pay the least amount of tax in the UK, leading to wealth disparity with the majority of the population. Following the row, Akshata Murthy has taken steps to address this by offering to pay UK taxes on her overseas income.

For HNWIs and companies, ties and associations with Russia will continue to increase reputational risk in the coming months and years. Any photographs taken with prominent Russian figures are likely to be unearthed and highlighted. And any links with companies that are not pulling out of business in Russia are likely to be seen in a negative light. Some companies and public figures have diluted negative press with humanitarian acts such as providing aid to Ukraine, but once an association is publicly criticized, it is difficult to repair the damage caused completely.

ESG

ESG (the environmental, social and governance aspects of a business) has become increasingly important to brand reputation in recent years. Businesses that fail to prioritise environmental and social impacts risk consumers and employees seeking alternative brands that align with their values. And with an ever-increasing sensitivity to greenwashing, brands and their leaders must ensure their ESG credentials are genuine, robust and transparent.

Investors are paying close attention to companies’ track records when it comes to ESG. They are looking for ethical companies whose values they align with, but are also interested in ESG from an economic perspective: ESG considerations may be integrated into regulatory frameworks, and contribute to the future success and profitability of a business.

A company’s ESG credentials must be able to withstand scrutiny. Being exposed as a company that engages in greenwashing can lead to strong criticism, with a significant negative impact on an organisation’s image. Starbucks experienced this in 2018, when it released a strawless lid which contained more plastic than the old lid and straw combined. The public perceived this as an insincere attempt to promote baseless green credentials, and the Starbucks brand suffered damage as a result.

Regulators and stakeholders are cracking down on greenwashing, with the UK Competition & Markets Authority (CMA) publishing the Green Claims Code in 2021, and announcing in 2022 that it would carry out a full review of misleading green claims. And there has been a rise in the number of adverts banned for greenwashing, with the Independent claiming that this tripled in the year to March 2022. Even when accurate, ESG claims made by companies are now intensely scrutinised by journalists, with any perceived hypocrisy considered newsworthy.

Reputational risk to companies and individuals is impacted by the ethics and values of the public and the media, which are ever-shifting and influenced by external factors including politics, climate change, war and inequality. For companies and individuals looking to ensure they manage their reputation, it’s essential to be aware of the issues that are influencing public opinion, and how these may appear within their own online profile.

Join our newsletter and get access to all the latest information and news:

Privacy Policy.
Revoke consent.

© Digitalis Media Ltd. Privacy Policy.