When Regulators Start Walking the Walk
From Capitol Hill to the White House, federal lawmakers and regulators are talking tougher than ever about regulation. The crisis in the nation’s housing market, the roller-coaster ride on Wall Street and the series of safety scares and recalls involving spinach, toys, toothpaste, beef and pet food are driving both political parties to call for stricter regulation of consumer products and financial services.
“We’re in for a potentially significant regulatory response,” Glenn Hubbard, dean of Columbia University’s business school and a former chief economist for the Bush White House, told The Wall Street Journal this Monday.
Simply put, 2008 is shaping up to be a very scary year. Increased scrutiny of product safety and efforts to punish unscrupulous service providers is a priority at the Consumer Product Safety Commission, the Food and Drug Administration, the U.S. Department of Agriculture, the Environmental Protection Agency, the Securities and Exchange Commission and any other government agency that has oversight authority.
Most important, recalls are attracting ever more media attention to any manufacturer, retailer or wholesaler that issues a recall. And with words like “E. coli”, “salmonella”, “mortgage meltdown” peppering newspapers, magazines, the airwaves and the Internet, one can safely assume that every corporate logo potentially looks like a bull’s-eye to lawmakers, regulators and journalists eager to make headlines.
Smart companies need to have their crisis plans in place and tested now so that they aren’t caught flat-footed when the spotlight inevitably hits them. In recent weeks, we saw the bankruptcy of the Hallmark Westland meat company, which took appropriate steps to protect consumers during the largest beef recall in history, but was overtaken by events because it had no crisis communications plan in place.
We’re not just talking about mere message points and creating a call-list for reporters. What’s your Internet blogging strategy? Has your website been optimized? How are you tracking what your adversaries are saying about you online? Who’s working with the regulators in Washington or in your state capital? Who’s on speed-dial to prepare your team to testify before a Congressional committee? All these questions and more need to be answered BEFORE the crisis hits. So, use your peacetime wisely and prepare your crisis plan now. It could mean the difference between your company’s survival and its demise.
