Failure to Plan Increases Risk of Reputational Damage

This article was originally published by Thomson Reuters’ Corporate Counsel Connect

While most senior legal officers across corporate America acknowledge the importance of communications with stakeholders during high-profile lawsuits, the majority have outdated strategies or no strategies at all to direct communications outside of court, according to a new survey conducted by my public relations firm, Greentarget Global Group.

This lack of preparation leads to overly conservative communications, the survey shows, with decisions and actions that are often impulsive and governed by the fear of negative media attention. Ironically, these instincts can compound the likelihood of reputational damage.

This vicious cycle – an increasing number of high-profile lawsuits, deficient planning, conservative approaches, and the resulting risk of negative attention – can be curtailed with foresight and premediated action by senior legal officers. Here are the steps to take in preparation for likely scenarios and in the event that the actual situations occur.

Giving some level of advanced thought, the following actions can save precious time when a high-profile lawsuit is filed and the questions start pouring in.

  • Crisis response team. To save time and limit confusion, have a team in place with one leader and key representatives from decision-making functions within the organization – legal, external communications, internal communications, and marketing.
  • Decision tree and likely scenarios. Because it’s vital to know when to active the crisis team and alert senior management, we typically recommend a tiered hierarchy with level 1 as a low reputational threat and level 3 as the highest danger to the organization. Examples of each level should be thought through as part of the crisis team’s scenario planning.
  • Trusted outside counselors. A firm should have key outside advisors – legal, financial, public relations, etc. – on call to assist and strategize as situations dictate. Large firms should consider multiple advisor relationships in each category in case of conflicts.
  • Training and role-playing. If your organization’s leadership doesn’t have experience with the media or in crisis situations, drills and media training sessions are invaluable for driving home the critical steps and the resulting responsibilities.

Now should one of those scenarios occur, the crisis team activates. Here’s how:

  • Determine whether it actually is a crisis. Not every difficult situation is a crisis. The crisis team should gauge near and longer term reputational impact before they act.
  • Gather the facts. In most crises, time is of the essence, but the first step has to be gaining an understanding of exactly what is happening.
  • Speak only to the facts. As in court, speculation and predictions can get you in trouble.
  • Develop messages and press statements. Common messages include some form of explanation and a denial or acceptance of responsibility followed by concise and actionable steps.
  • Choose the spokesperson wisely. Senior leadership should only be used in the most pressing circumstances, as their presence will draw attention and highlight the seriousness of the matter.
  • Communicate internally. This is where companies most often fail. The risk of misinformation is high if the crisis team does not arm internal constituencies with facts and talking points.
  • Leverage the gaps. Most crisis communication revolves around events. However, smart firms can use the quiet time in between to advance their side of the story.
  • Assess the situation and adapt the strategy. Crises are unpredictable. It is critical to continuously evaluate the circumstances and modify the course of action as needed.