When the Worst Happens: Managing Your Company’s Reputation

March 3, 2014


“The CEO has been arrested,” “There’s been a chemical spill,” “We’re on the short-sell hit-list.” These and many other types of crises strike right at the heart of any company involved, and that includes the investor relations department.

Combined with increasing demands for good corporate governance and transparency for Asian companies, issues affecting reputation are ever-more important to corporate performance in the region.

With this in mind Barclays invited FleishmanHillard to present at its inaugural Investor Relations Forum held in Hong Kong in February. Over 70 CFOs and senior IR professionals from leading Asia-listed companies attended the forum to learn more about: what sort of communications long-only and hedge fund managers want to receive, what drives share price from a financial analysis perspective, and what to do vis-à-vis your investors when your reputation is damaged or under threat.

Barclays IR Forum

FleishmanHillard’s Patrick Yu and Linda Carroll, both finance and crisis communications specialists, took the audience through a range of case studies and scenarios to illustrate worst and best practices in terms of crisis preparation and issues and crisis management.

“What we’re seeing in Asia is that increased scrutiny and activism from civil society, together with high levels of social media usage, means that crises are spreading faster and further than ever before,” Linda told the audience.

Patrick also talked about the ‘China spillover effect’ whereby many companies in the region experience more scepticism about their balance sheets, management and business models than might otherwise be the case, “Many companies in this region have seen their share prices decimated just through association, so crisis planning is not something you can leave for another day.”

Drawing from FleishmanHillard’s proprietary crisis preparedness model, A.R.C™ (assess, resolve, control), and using the Hong Kong office’s recent crisis-related project experience, Patrick and Linda laid out the key steps IR departments should work through to protect their company from reputational threats, and to regain control if and when a crisis breaks.

“Companies that are crisis-prepared actually experience fewer crises, perform better and stay in business longer,” they emphasized. “What matters isn’t the crisis, but how well prepared you are for it, and how well you respond to it.”