Adverse media screening can transform a company’s reputation risk management operation and drive new business opportunities. But amid heightened risks of online misinformation, a careful strategy is required to implement an effective adverse media screening process. This blog suggests five questions you should think about to build a best practice negative news screening operation. It then looks at how adverse media screening tools from LexisNexis can help you to get there.
A significant competitive advantage is available to companies that can rapidly identify reputational issues before they do irreversible damage. Adverse media screening offers an early-warning system to help firms better identify and manage risks during due diligence, Know-Your-Customer and Know-Your-Client checks. It can also help to scope out new partnerships, mergers and acquisitions, products and other initiatives.
But implementing (or improving) a company’s adverse media screening process requires careful planning. Recent trends have made a third party’s reputation more difficult to assess accurately. These include the digitization of news; rising risks of misinformation and ‘fake news’; and accusations of ‘greenwashing’. Here are five questions to ask to ensure your screening can deliver accurate and relevant results for your company:
1) Do you have a comprehensive set of media data?
Most people now consume media online, which means a story that would have once been localized to a particular market can quickly spread to become an existential problem for any firm operating internationally. Adverse media screening therefore needs to cover a wide range of media sources in many different countries and languages. Rapid detection of negative stories lets companies act quickly to mitigate risks. Access to an archive of news data spanning decades is particularly useful to surface historic allegations or risks.
2) Can you trust the media data sources you are using?
Basing decisions on unreliable media sources could be extremely costly, especially when using news data to support risk-based compliance decisions. Adverse media screening should therefore look at the most reliable, trustworthy media outlets. These publications typically follow a code of conduct which includes verifying and fact-checking information and citing the provenance of their sources–as well as declaring when that source has a vested interest.
3) Are you using technology well?
Adverse media screening is most effective and efficient when it is done with the support of a technology partner. Technology solutions allow companies to upload names of entities and receive only the most relevant, filtered negative news articles based on the right keywords and context. For example, some providers use AI-powered Natural Language Processing and sophisticated entity resolution to improve the accuracy of results and reduce the time companies need to spend reviewing flagged adverse media
reports.
4) Are you implementing adverse media screening strategically?
Companies will achieve the best results from adverse media screening if they use it strategically. For example, they should decide what it is they want to understand about a particular entity’s reputation, whether that’s bribery and corruption risk, ESG impact, product reputation, or something else.
Many companies have successfully embedded negative news screening an early step in a broader compliance and due diligence process. A negative article triggers their processes to find out more information about the risk or take action to mitigate the media storm. The article can be cross-referenced and verified against other sources, such as legal data, company data, financial information, sanctions and watch lists, and PEP disclosures.
5) Are you acting on the results?
A survey of global executives by Weber Shandwick found companies who reported that their reputation drove their financial performance were more likely to have in place media monitoring underpinned by the engagement of senior leadership. There is little point in having the tools to detect adverse media risks if the C-suite is going to ignore those risks because they are laser-focused on profit.
Management must be made aware of negative news stories as soon as possible after they break. Then they should prioritise finding out more information or taking action, even if that is as simple as putting out a statement to calm a storm on social media. After that, a longer-term strategy may be necessary to remedy the problem and restore trust.
Power effective adverse media screening with data and technology from LexisNexis
Companies should ask these five questions when seeking a partner to support their adverse media screening. LexisNexis is a partner which can demonstrate a tenure of expertise in the field, a focus on quality, and an ability to evolve with new technologies and regulations.
We work with a global network of trusted media providers to deliver a comprehensive collection of news and media data. Our decades-long history of publisher partnerships ensures that our clients have access to the most comprehensive and reliable information possible.
We bring together more than 20,000 premium, regional and local news sources from all over the world–which cover over 100 languages–to help support a robust adverse media screening process. This also draws on our archive of 40+ years of comprehensive media data.
Looking for more tips on how to implement adverse media screening as part of an effective due diligence process? Our E-Book, ‘The Age of the Reputation Economy’, explains why adverse media screening has become essential for companies seeking to manage risks and exploit opportunities. Download it for free today: https://lexisnexis.widen.net/s/jcwkqkdfs6/seg-gns-ebook-adverse-media-reputation-economy
Legals:
These materials are not intended to provide legal advice for specific circumstances and should not be relied upon in place of professional advice and judgment LexisNexis and the Knowledge Burst logo are registered trademarks of RELX Group Properties Inc., used under license. © 2024 LexisNexis. All rights reserved