Monday, March 8, 2010

You're Kidding: Negative News Is A Crisis Risk?

Negative publicity or “bad press” is now recognized as a potential risk to business, according to a story in PRWeek this week.

It apparently became official when Goldman Sachs included it in their February 26 ‘2009 10K’ filing. The Wall Street Journal reported the risk of “adverse publicity” was now on Goldman Sachs radar.

The Journal cited Goldman’s 10K as saying managing negative news coverage “is time consuming and expensive.” The filing ads, it can “have a negative impact on our reputation and on the morale and performance of our employees, which could adversely affect our businesses and results of operations."

Ed Canaday, Goldman Sachs Vice President of media relations, said it was the first time the company has officially recognized the risk of negative news coverage, but apparently would not elaborate.

This makes me wonder where they have been getting their crisis consulting and planning advice, because the Institute for Crisis Management has included a section on “Seriously Negative News Coverage” in almost every crisis communication plan we’ve written for almost every client from international manufacturing, to higher education, to healthcare, small businesses and not-for-profits.

And we’ve included that “risk” and how to prevent it, where possible, and how to manage it when it cannot be avoided, in our client crisis plans since at least the early 90’s.

An organization doesn’t have to do anything wrong to become the target of an investigative reporter or other negative publicity. Just last year, a small, family-owned sausage making company in Cleveland, OH was smeared across the local media, accused of running a “smelly” business that was damaging the already declining neighborhood.

After months of harassment from the county health department and several stories about the foul odor, police found the decomposing bodies of eight women in a neighboring house and back yard. Eventually the man who lived in that house was charged with 8-counts of murder. And the next door business is still recovering from the undeserved bad press.

And, when the business or organization does do something wrong, managing the negative public reaction is just as important as fixing whatever went wrong in the first place.

If your crisis communication plan does not have contingencies for negative news coverage, deserved or not, then you need to call the Institute for Crisis Management 502-587-0328.

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