XYZ Company limited is a BSE listed reputed chemical manufacturing company. Recently, there is a fire incident occurred at one of its plant location. The directors of the company are worried about this fire incident's im

Reputation Risk as the risk arising from negative perception on the part of customers, counterparties, shareholders, investors, debt-holders, market analysts, other relevant parties or regulators that can adversely affect an organisation 's ability to maintain existing, or establish new business relationships and continued access to sources of funding (e.g. through the interbank or securitization markets). Reputational Risk is multidimensional and reflects the perception of other market participants. Furthermore, it exists throughout the organisation and exposure to reputational risk is essentially a function of the adequacy of the bank's internal risk management processes, as well as the manner and efficiency with which management responds to external influences on bank-related transactions.