Feature | Risk Management
Managing Risk … to Your Reputation
Preparation is paramount in surviving a reputational crisis
We want answers. Photos: NASA; Stock
N February of this year, a multinational general public to members of Congress. When that lacked the reputational strength of the case
aerospace and defense contracting company taken alongside its well-publicized charitable and study above taken to task on the front page, in the
paid nearly $500 million to the U.S. Depart- educational initiatives, the company had nightly news, online and, eventually, in Congress,
ment of Justice and the British Serious Fraud conditioned the marketplace to be forgiving of its the White House and the Pentagon. By the time
Office to settle a case involving allegations of missteps. Simply put, the company’s efforts to remediation efforts are underway, the news cycle
corruption. Given the sheer size of the penalty – build a strong brand before a reputational crisis has moved on and often irreparable damage has
and that of the company that paid it – one would arose elicited a “that’s not the company I know” been done.
think that the company would soon play the role response when a blemish inevitably occurred.
of poster child in the ongoing debate surrounding In such a perilous setting, the best – and often
proposed reforms of the defense procurement The word “inevitable” is key, because the current only – way to protect a company from catastro-
system. But that has not been the case. In fact, the reputational landscape is as challenging as it has phic reputational damage is to proactively build a
company just won a multimillion contract from ever been for defense contractors and the peace strong corporate reputation that earns the
the Army Research, Development and Engineer- operations industries. Budget deficits and good- ongoing admiration and respect of customers, key
ing Command, just one of the many pieces of new old-fashioned politics have dovetailed to drive stakeholders and the public at large.
business they have garnered since the settlement vastly increased government scrutiny. Meanwhile,
was announced. every unfortunate misstep by a government Simply put, it is about making enough deposits in
contractor involved with either large weapons the corporate trust bank during periods of relative
How did the company emerge unscathed? Not systems or on-the-ground operations has calm to ensure that withdrawals during crisis do
only was its performance for the customer as emboldened opponents’ attacks and claims of not leave an organization in the red. In a world
close to impeccable as exists in this day and age; it “war profiteering,” an incendiary charge in today’s where the media drives government policy and
aggressively articulated that record to public and environment. decision-making, effectively publicizing a strong
private stakeholders that run the gamut from the record of results, an excellent management
The reality that most of these incidents are structure and commitments to safety, ethics and
isolated – or that accusations are often inaccurate Corporate Social Responsibility (CSR) is what
Adam Clampitt is a Vice President at Washington D.C.- or politically motivated – simply does not matter, enables a firm to emerge from a crisis with its
based Levick Strategic Communications and the former even in cases where a single bad actor in a reputation intact.
Director of Public Affairs Plans and