As a business leader, you know that not everything will go according to plan. Sometimes circumstances will arise that will reveal that, despite your best efforts, members of your staff have acted unethically. This is not only a blow against your values as an entrepreneur and your trust as an employer, but it can also be damaging to your business.
Recovering from a scandal is not an easy process. And in today’s connected environment, the news can spread globally via the internet in an instant. It’s also the case that even in the years after the core problem, details of your ethical issues will be just a quick search away. Any scandal has the potential to leave your online reputation in tatters if handled without due care.
How should you approach your recovery from a corporate scandal? What strategies and tools can you implement to improve both your reputation and toxic company culture? Let’s take a closer look at some key areas of focus.
Addressing the Problem
Some of the major mistakes that companies make in the wake of a scandal are in their initial response. Reacting too sluggishly, or in a lackluster fashion can be disastrous. A prime example of this is the 2009 Domino’s Pizza scandal, in which employees posted YouTube videos of themselves breaching food preparation laws. The company waited two days to respond, and when they did so it was little more than a simple apology.
Your reaction to a scandal needs to be both swift and well-considered. This is a difficult balancing act. Depending on the severity of the scandal, there may be a need to take legal advice before fully addressing consumers and staff. That doesn’t mean that you shouldn’t acknowledge the issue, however.
Work with your public relations department to produce an honest and direct initial press release. Inform the public that the company is aware of the problem and its severity, and that there is a need to investigate the matter fully. Set expectations as to what the next steps are, and when you intend to follow up.
Release this across all channels — your email list, press departments, website, and don’t ignore social media. This blanket coverage handles the need to vocalize the event to the public and doesn’t give the impression you’re ignoring the matter. It also provides you with time to make the necessary inquiries and planning to fully address the problem that resulted in the scandal.
However, don’t make the mistake of assuming that because you have made an announcement your responsibilities for communication are complete. Provide regular updates on progress and keep a dialogue open to reassure stakeholders that you and the company take the matter seriously.
No Quick Fix
For many of us, once a scandal has hit, we want to be able to just fix the situation. However, scandals are generally not that easy to repair. The issues that have a significant impact are ethical, social, and even legal and therefore require long term effort to put right — if they can be put right at all.
The Uber scandal in 2017, which revealed a culture of sexist and abusive behavior, resulted in the resignation of CEO Travis Kalanick. However, the simple resignation of a CEO is often not enough to repair the damage; you need to put in the work.
Businesses must be demonstrative in their efforts to get to the root cause of the scandal, along with the actions they take to make retributions and prevent further incidents. If, as in the Uber case, there is a culture of abusive or discriminatory behavior, this points to a systemic issue. As a result, it’s often wise to bring in independent experts to assess practices and create improvement plans. These findings should be made public, alongside your reparation plans.
The behaviors that lead to a scandal are often already addressed in the employee handbook or company policies. Few businesses don’t have guidelines regarding sexual harassment and other unethical or illegal behaviors. If there is a culture that allows this behavior to thrive, this suggests that enforcement of these policies is somewhat lax.
One of the key ways to restore consumer confidence then is to enact a stricter approach to these rules and regulations. Conduct training exercises to reinforce their importance and demonstrate their application. Review the violation policy and make any disciplinary consequences clear — and enforce them.
The dust has settled somewhat, you’ve taken what you feel might be the worst of the hits, and made plans to improve the overall culture of your business. So, now what? Your time must now be spent rebuilding the trust and respect of consumers and staff. It’ll be a long road, but by taking the patient and thorough approach, your business is likely to be stronger in the long run.
Moving forward, there needs to be a commitment to transparency and accountability. This must be a top-to-bottom policy; be open about how your business runs, your financial operations, and the partner companies you have relationships with. Invite staff members of all levels to attend key company meetings, seek their input on policy changes, diversity, and ethical operations. Invite the public to highlight when they feel you’re falling down in your obligations and make it easy for them to engage in a dialogue with company leaders. This not only encourages a culture of honesty throughout the company, it shows the public that it is a core aspect of your business operations.
It can also be wise to put some work into rebranding. This essentially acknowledges that the business has made mistakes in the past, but you’re also taking a concrete approach to be a better, different, more positive business moving forward. One of the key elements in creating a new brand is understanding your goals.
One of your new goals is obviously a stronger culture that eliminates recurrences of the incidence that got you here in the first place. You can then start to tell an effective story through the visual and marketing aspects of your new brand. After a scandal, this story is likely to be about change, trust, and responsibility. Create brand values that reflect the new approach of your business and demonstrate these frequently.
Recovering from a corporate scandal isn’t a quick and easy process — and neither should it be. By correctly acknowledging the problems, working to make meaningful change in the company, and moving forward with patience you can help rebuild consumer and staff confidence in your brand.