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MISSION:INTANGIBLE, the blog of the Intangible Asset Finance Society, offers critical comments on intangible asset, corporate reputation, and finance; supplemented by quantitative reputation metrics. Intangible assets include business processes, patents, trademarks; reputations for ethics and integrity; quality, safety, sustainability, security, and resilience; and comprise 70% of the average company's value. MISSION:INTANGIBLE is a registered trademark of the Intangible Asset Finance Society.

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BP: 2010 reputation story of the year

C. HUYGENS - Wednesday, December 22, 2010
Reputation is a story with chapters on building, protecting and restoring. In 2010, BP made for compelling reading. The reputation metrics shown below, courtesy of Steel City Re and its Corporate Reputation Index, speak volumes.

BP's own reputation metrics and derivative volatility metrics suggest that its reputation is very much on the mend, but it is still hovering in the vicinity of the 80th percentile, and it is still highly volatile. The fourth chart shows the median and variance for the 51 industry peers.

The highlights. At the depths of the reputation crisis, BP's intangible asset value (chart 5) dropped to nearly 0%. Its equity value has been crawling back but it is still underperforming its peers by 33%. BP's EWMA volatility is harmonically settling down but is currently still high at 80%. For the past quarter, the reputation velocity has been positive. However, again as shown in chart five, its intangible asset fraction is still below the mean of its peer group -- a significant drop from its value twelve months ago.

Huygens now takes a holiday. Best wishes to all and looking forward to continuing the conversation early in the New Year.



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