Boards are all talk on soft issues.

(From Financial Director)

Byline: Robert Bruce.

Wherever you find a collision between theory and reality you find battered egos and broken businesses. This is what has happened over the issue of reputation risk. Everyone played lip service to the theoretical threat. No one did much about it. And now people are getting hurt.

Take the events which took place in the opening days of October. Ric Piper, former FD at WS Atkins, was poised to step from support services and the world of the public finance initiative, into the media. He was about to take up the position of FD at Trinity Mirror, publisher of, amongst others, the Daily Mirror newspaper. But a political row about the value of PFI swept over the Labour Party's annual conference and then Atkins issued a profit warning. Its shares went into freefall.

On the following day, Piper was due to start his work at Trinity Mirror.

But he never made it. That, for finance directors everywhere, was horrific news. Reputation risk had claimed a real and high-profile victim. The chairman of Trinity Mirror, Sir Victor Blank, made the connection clear.

"Had it not been for the statement on Tuesday, and the element of reputational risk to us," he said, "the appointment would have continued as planned."