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In our connected times, both serious news and gossip travel at the speed of social media. When tragedy or scandal strikes a company, if that company isn't prepared to manage its reputation, there could be severe consequences. Think Steve Wynn and the $2 billion bad day.
And though a company can't predict if or when it will face the wrath of scorned social media users, it can certainly be prepared to take action. Below, you can find three tips to help GCs handle corporate reputational risks.
1. Have a Game Plan
Regardless of who makes up the C-suite, it is advisable to have a few plans ready to execute in case of scandal, as the recent NY AG scandal shows us, even those the public regarded as noble can prove to be otherwise when misconduct is discovered.
These plans don't need to be too specific, but should address different issues, such as social media, traditional media, and the potential ouster of company officials. Additionally, there should be specific plans created for various levels of employees, who should be trained on what to do (or simply how to follow the plan) if a scandal arises.
2. Practice Crisis Control
Though it may seem disingenuous to practice crisis control, running a crisis control drill, or a tabletop exercise, can prove beneficial. For example, you can test how employees respond to potential reputational issues to monitor if they are following their training.
Protip: Avoid drills that are a complete surprise to everyone as you don't want an employee being tested to go rogue. Drills are meant to be training exercises, not tests of whether a person will sink or swim.
3. Don't Let Matters Boil Over
Be proactive when issues arise and do the right thing. Also, regularly audit the company's public and private affairs for potential scandals so the company can get ahead of any negative publicity. Just recently, Panasonic was hit with a rather massive penalty as result of a subsidiary's actions.