Hewlett-Packard chair Patricia Dunn learned the hard way about the impact the media can have on a corporation, stepping aside after a botched internal probe at her company.
Dunn initiated an investigation into news leaks emanating from her board. Investigators used questionable techniques to collect information, such as telephone records from board members. At press time, HP was facing investigations on a number of fronts, ranging from the U.S. Securities and Exchange Commission and Federal Communications Commission to the FBI, and even the California Attorney General’s Office.
HP is certainly not the first company to feel the scorpion-like sting of media scrutiny and it won’t be the last. Every day, Canadian companies, both public and private, face the prospect of media hordes showing up on their doorstep. An unexpected workplace accident, a police or regulatory investigation, or class action lawsuits are among events that prompt news trucks to roll up to the gates.
When they arrive, it’s often in-house counsel who are front and centre and called upon for advice. That can be a challenge for lawyers, who are trained in the art of legal communications and speaking to judges and other lawyers, versus the art of public communications, says Geoffrey Rowan, managing director of Ketchum Public Relations Canada and a former journalist.
“Communicating to persuade is a communication based on an emotional understanding, which differs greatly from a communication that is based on legal technicalities,” he says from his Toronto office.
“Communicating within a tight legal framework might limit immediate legal risks, but if it creates enormous potential reputational risk, then the cost to the company may well end up being much greater.”
Dave Gordon, senior vice-president of Cohn & Wolfe Public Relations in Toronto, says one of the biggest problems companies face in a media crisis is gaining or maintaining trust and winning over the public. “Too often, corporations seem, fairly or not, to hide behind their lawyers.”
Rowan adds that the essential audiences “do not listen to what a company communicates from a legalistic point of view. They listen as people. People get frustrated and sometimes angry when they do not know what is going on.”
He says the classic “no comment” line doesn’t cut it any more. “Unfortunately, outside of the courtroom a no comment has become roughly comparable to an admission of guilt.”
So, what does in-house counsel need to do? Here are the top five things you need to do to prepare for a media crisis.
1. It’s all in the planning
Public relations experts say good crisis management starts with a strong plan. Peter Pliszka, a litigator at Fasken Martin DuMoulin LLP in Toronto who advises clients on managing media during complex litigation, says the biggest mistake he sees companies make is “not already having a preparation plan and strategy.”
“Most things we consider crises, should not be crises. It’s about preparation,” Gordon agrees. It’s not hard to evaluate each industry to determine the risks and what bad things might happen to cause a media circus.
For example, for the airline industry it’s a crash, in mining it’s a cave-in, in manufacturing it’s a death on the shop floor. “All eventualities should be prepared for,” says Gordon. “By preparing for the worst-case scenario, you’ll be in a good position to manage everything else.”
2. Don’t turtle, say something
Rowan says “reputation is a critical asset with real value, which translates into increased market cap, increased marketshare, ability to attract and retain customers and employees, ability to better withstand economic downturns, and ability to charge premium prices.
“But when something negative happens, inside counsel have an instinctive reaction to cut off the flow of information, worrying that anything the company says may be used against it.“Certainly companies have to be thoughtful about what they communicate, during difficult times, but clear communication will not only protect reputation but may also result in cost savings.”
Take a simple product recall. There’s a hard cost associated with each call to a call centre as people seek information on what to do. “If the company can communicate clearly enough to reduce the number of calls to call centres, it will reduce its costs,” he says.
3. Manage the information flow
Gordon says the “most important things about communicating in a crisis are honesty, integrity, and speed.”
Identify your different audiences and whom you need to speak to, says Gordon. It could include customers, suppliers, employees, investors, families of people affected, or government officials. “Recognize they all need to hear different things, but they need to hear them quickly.”
Spend time in advance collecting key data about your organization. For example, if you’re in an industrial
setting, have facts and figures about your plants available in advance. “You shouldn’t have to spend time putting them together. You need to have everything ready.”
Act quickly, he says, to correct any false or erroneous information that is circulating and remember, “the one thing that you do wrong is the thing you will be remembered for.”
Pliszka suggests developing “key messages” that reflect the core values of the company and figure out your objectives in advance. He says these will have to be modified to fit the situation. For example, key messages for a shareholder class action will differ from those for a toxic spill.
“You never want more than three key messages.” If you have too many, he says, it “becomes one incoherent cluster.” It’s important to map them out in advance of speaking to the press and they should be able to be communicated in a handful of words or 10 to 15 seconds.
“The worst situation would be having to figure out for the first time what your primary objective and key messages are while a reporter is standing in front of you with a microphone in your face.” Most importantly, he says, don’t speculate and do stick to the facts.
4. Designate a spokesperson
Pliszka says managing the media during a crisis is every bit as important as due diligence during a commercial transaction. “It really is becoming an essential element.” It’s important for a company to speak with one voice. “What you need to do is make sure that all the people in the company know who is authorized to speak on behalf of the company when the media calls.
“Most importantly, everyone needs to know who is not authorized to speak on behalf of the company when a crisis arises.”
The ideal spokespeople should have media training and be able to speak in sound bites. “Speaking to the media is an art. Journalists speak and think and work in a different way than typical people speak and think.”
Pliszka adds, “The precise person to be the spokesperson to some extent will vary depending on the nature of the crisis and the magnitude.” The more serious the crisis, the greater need to put forward the “top person in the food chain” to reassure the public “the company is doing everything it possibly can to solve the problem.”
Gordon says media training is important. You won’t turn your spokespeople into news anchors, but “media training helps them understand how the media works.”
5. Be timely and empathetic
Rowan says companies are being judged in a crisis, so what they say and how they say it is critical. “To diffuse anxiety and anger, it is important that you tell people how and when you will give them information, and then you follow up on that. Even if it is to say that we don’t have all the information we hoped to have.” Avoid the “non-apology apology,” such as, ‘We are sorry that Mr. X feels that he has suffered.’
“Don’t underestimate the intelligence of media consumers. The vast majority recognize weasel words.”
Rowan says, “If there is human tragedy, then show real compassion.... rather than having counsel read a statement.”
