Lawyers Weekly

House Message

At the Corporate Lawyers Association of NZ conference, Washington-based Richard Levick gave an expert’s view of how in-house counsel can ensure they are helping to maintain their employers’ reputation

Twenty-four-hour news cycles, 200-channel television, and ever more investigative reporters make it a near certainty that companies will at times face a hostile media. What is the legal counsel’s role during these times?

Plaintiff law firms spend six to eight times the amount of their defence brethren on media. The US Securities and Exchange Commission, Department of Justice and other agencies have become experts working with the media. Non-governmental organisations have one tool the media and they use it exceptionally well. When it comes to media, these constituencies ‘get it’.

But corporations and their defence counsel work under the ‘ugly circle’ rather than an early warning system. This is the circuitous route by which in-house public relations professionals are often intimidated by the very in-house legal counsel they are expected to warn of a pending media crisis. Simultaneously, in-house counsel expect outside counsel to see the media warning signs. And outside counsel have none of the media training or even expectation that this can or should be a part of their counselling.

The result is almost always a defence that is way behind the media curve.

High-profile cases and matters get tried in two courts – a court of law and the court of public opinion. Stock values, product viability, and corporate reputation are all decisively affected by what happens in the court of public opinion. In-house counsel and lawyers in private firms need to think and work differently to protect the most valued asset, the corporate brand.

To protect your brand in the face of negative media coverage it is crucial to actually recognize that you have a problem. Once you have acknowledged that there is a problem, in-house counsel must work hand-in-hand not only with outside counsel but also with public relations professionals (the in-house department and out-side media experts) to manage the situation with as little disruption as possible.

There are several key steps to making sure your organisation fairs as well as possible in such a situation. First, you must plan for the worst, taking into consideration worst-case scenarios and deciding on the appropriate action to take, should this arise, well in advance.

Second, the earlier the corporation admits there is a problem, the gentler the media reaction to the situation will be. I have seen countless cases of late where corporations try to sweep their problems under the carpet and invariably it blows up in their faces.

Third, take responsibility as soon as possible, even if the problem is not your fault. By acknowledging responsibility, but not blame, the corporation gains empathy from the media and public alike, which in turn is less likely to incur negative publicity.

Fourth, never underestimate the power of messages from top-tier management. The role of the media is to keep the people abreast of the news and, as such, they don’t like it if they feel something is being kept from them. A message from the chairman of a troubled corporation goes some way to calming the fears of investors. In addition, choose your spokesperson wisely. He or she should be authoritative but avuncular, stay on message and be likeable.

Fifth, delay laying blame and pointing the finger if at all possible. Solve the problem.

Sixth, follow the rule of the media – photo, headline, story. People think in pictures so make sure your message has a literal and figurative picture. If you have better pictures in the media than your opponent, you win.

And lastly, make sacrifices for the good of the brand name. Johnson & Johnson pulled Tylenol and all over-the-counter products off the store shelves before they knew the source of the contaminated medicine. Message to consumers: “We care more for our consumers than our profits.” Result? After a short-term loss, a 20-year run of being considered one of the friendliest corporations in America, dominant market share and extraordinary corporate consumer trust.

Recently, The Gap chose a similar strategy, releasing its own critical report on global sweat shops, and using it as an opportunity to set new, substantially improved standards for the garment industry. When faced with a crisis, what sacrifice can you make that will increase the trust factor between the corporation and its audiences? It will pay huge dividends.

While following these steps obviously can’t protect against every possible outcome, it will limit the damage that can be caused from negative media attention.

Richard S. Levick is president of Levick Strategic Communications