- Strengthened Reputational Risk Framework
- Initial assessment of reputational risk within the business divisions
- Regional Reputational Risk Committees in place to assess material reputational risk
The reputation of Deutsche Bank is founded on the trust of clients, shareholders, employees, regulators, and the public. Isolated events have been seen to negatively impact our reputation, and it is the responsibility of every employee at the Bank to uphold our position of integrity.
We define reputational risk as the risk of damage to the bank’s brand and reputation, and the associated risk to earnings, capital or liquidity arising from any association, action, or inaction that could be perceived by stakeholders to be inappropriate, unethical, or inconsistent with the bank’s values and beliefs.
Managing reputational risk
Reputational risk is governed by the Reputational Risk Framework (the Framework), which was established to provide consistent standards for the identification, assessment, and management of reputational risk issues. It is in place to manage the process through which active decisions are made on matters that may pose a reputational risk and, in doing so, to prevent damage to Deutsche Bank’s reputation wherever possible (defined as Primary Reputational Risk). The Framework embodies the bank’s Three Lines of Defense (3LoD) principles.
Reputational risk can arise from multiple sources including, but not limited to, environmental and social impacts, issues with counterparty profile, high risk industries and potential issues with the substance or nature of the transaction or product.
Reputational risks are initially assessed within business divisions through their Unit2 Reputational Risk Assessment Process. In the event that a matter is deemed to carry a material reputational risk and/or meets one of the mandatory referral criteria, it must be referred to one of the four Regional Reputational Risk Committees (RRRCs) for further review (the second line of defense). The RRRCs are sub-committees of the Group Reputational Risk Committee (GRRC), which has been delegated responsibility by the Group Risk Committee, a sub-committee of the Management Board.
In 2016, we further strengthened the Framework by enhancing our Global Reputational Risk Principles and Global Reputational Risk Guidelines, which set out the standards for the management of reputational risk; by increasing awareness of the Framework across the bank through training; by expanding the Reputational Risk Function; and by implementing the Reputational Risk IT System, which supports the process end-to-end.