|Whit Clay and Jill Zuckman co-authored this article.|
As we turn the page on 2020 and open a fresh chapter in 2021 with President Biden, a new Administration and a new Congress, it’s important that companies take a close look at what has worked—and not worked—when it comes to the crises and issues of the past year. And it’s equally important that they prepare for the year ahead, which will bring new challenges—but also new opportunities—to engage in a much different political, social and regulatory climate.
When the Stagwell Group provided the capital for SKDK to acquire Sloane & Company in February 2020, the fundamental premise was that two strategic communications firms working together, one with expertise in public affairs and the other in financial communications, would offer compelling growth opportunities. It would enable clients to tap into experienced executives recognized for providing advice, counsel and execution to address some of the most complicated and compelling communications crises and opportunities, whether in public policy or the public markets.
Few of us could have imagined that just weeks after beginning to work together, the COVID-19 pandemic and resulting economic challenges would prove that the premise for our combination was not just speculative but, in fact, very real. And, just as companies had begun to manage their communications around those issues, they faced a new and equally difficult challenge: the demand to address systemic racism, diversity, equity and inclusion in the workplace. This all occurred at a time of deep social unrest when our divided country was in the midst of a pivotal election.
|This article is featured in O'Dwyer's Jan. '21 Crisis Communications & PR Buyer's Guide Magazine
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While these macro issues captured much of the media’s attention, there were many other day-to-day crises facing companies and organizations. If mismanaged, these events posed a significant threat to the reputations and valuations of businesses. They could undermine their executives and employees, as well as derail planned or potential strategic transactions.
What are the lessons we can derive from 2020?
There’s both an expectation and insistence from employees, customers, partners and government officials that companies engage in a meaningful way on social issues such as race and economic fairness. A July 9, 2020 poll by Harris Insights and Analytics, one of our sister agencies in the Stagwell Group, underscored this when it shared that Americans want to see companies commit to paying all employees a living wage (84 percent) and provide accessible grievance mechanisms for employees to report harassment or discrimination without fear of retaliation (83 percent). It’s imperative companies dealing with these crises be able to provide action, not just words. And they need to have reservoirs of trust and goodwill from organizations that are built over time and not simply in times of crisis.
At no time was this more evident than in the wake of the murders of George Floyd, Breonna Taylor and the many other Black lives that were taken and the national social unrest that followed. Many in corporate America saw the need to step up and speak out against years of systemic racism directed at their employees and customers. Diversity, equity and inclusion communications became more of a priority and we expect this to continue.
In the coming year, we can expect corporate social responsibility to meld with environmental, social and governance initiatives. We see an increasing focus on these issues among investors and expect the Biden Administration will use the bully pulpit and regulatory influence to insist that corporations act on climate, serve their employees and customers responsibly and work to improve their governance practices. Pressure will also come from investors, as demonstrated by recent shareholder pressure on ExxonMobil to reduce its reliance on fossil fuels and increase investments in clean energy. Grappling with these issues is necessary—not just as protection during a crisis—but because it’s the right thing to do and it can also provide a compelling opportunity to create value for stakeholders.
Misinformation that moves rapidly on social media—and is observed and reported by traditional media—is rapidly becoming the most pressing threat to a company, its leaders and employees. Society is increasingly vulnerable to inaccurate information and conspiracy theories that are not rooted in fact. We need not look any farther than the recent news around allergic reactions to the COVID vaccine to see evidence of the potential damage. When news leaked that individuals in England had gone into anaphylactic shock after receiving the vaccine, the market shuttered and pharmaceutical stocks dropped in early market trading. This required immediate action and response to clarify the facts, provide context and reassure an already skeptical and concerned public.
We must prepare companies to deal with misinformation on social media and to rapidly respond with the right messaging. Given the growing power that social media companies hold in overseeing and regulating content on their platforms, it will be increasingly important that companies and organizations have the ability to connect with Facebook, Twitter, Google and others to address their concerns about content through the right leadership channels.
In the face of these issues and others, Sloane & Company and SKDK recommend that all companies and organizations reexamine their crisis communications plans to ensure that they have the following components: effective monitoring tools that are able to identify issues in traditional and social media that are potential risks; scenario updates with message development informed by research and testing; effective processes and protocols to enable quick action and escalation within an organization; communication across all key audiences—including investors; and, finally, the right team of external advisors—legal, financial, cybersecurity, governmental and communications experts who have experience, relationships and understanding to assist through a crisis or transformational event such as a merger.
We also recommend running tabletop crisis exercises to put the crisis communications plan and team to the test including the participation of external advisors so that the group is not working together for the first time amid a real, ongoing crisis. There’s much to learn from these efforts and all too often companies and organizations are ill-prepared due to lack of practice.
In looking ahead to 2021, the words of Benjamin Franklin ring true when in 1736 he advised Philadelphian’s facing the threat of fires that “an ounce of prevention is worth a pound of cure.” Strategic communications professionals should heed this advice and make sure they are ready for the year to come.