Managing High-Exposure Crises

A Matter of Speed, Accuracy and Responsiveness

December 6, 2017 | Jarrett Wolf

Versión en español

Diplomatic tensions, money laundering, corruption and scandal. Crises do not resolve themselves and how they are managed will directly affect the outcome.

Start from the proposition that a crisis is a sudden event or evolving situation exposing an individual, organization or sovereign to significant legal, commercial, political, geopolitical, diplomatic, reputational or other consequences.

Too often, conversations about crisis management are limited to a discussion about crisis communications. Crisis management, however, needs to be about more than communicating about a problem. Crisis management needs to be about solving the problem and that often requires a multidisciplinary approach characterized by speed, accuracy and responsiveness.

Speed

The sooner you can get the right professionals involved, and the faster they can move, the greater the likelihood of a positive outcome. Crisis management does not lend itself to a bidding process or to a request for, and review of, proposals. When it’s time to manage a crisis, you need the right people and you need them immediately.

For high-profile individuals, dignitaries, companies and organizations, and for entities that regularly deal with critical incidents, such as law firms, family offices, embassies and consulates, one of the best ways to accelerate response time is to have an existing relationship with crisis professionals. The reason is not so that you know who you will call in the event of a crisis. That part is easy. The reason is so that the crisis management firm or professional you call already knows and understands you, your organization and the issues with which you deal.

Existing relationship or not, speed is critical. Crisis management is not the same as litigation. Crisis management is not the same as public relations, or even crisis communications. Crisis management requires being able to rapidly respond, quickly assess a situation, put together a plan, put together a team and coordinate the overall management of the crisis. Depending on the situation, that might mean being able to engage and coordinate the right lawyers, investigators, experts, consultants, government relations professionals and, yes, crisis communications professionals, in an unfamiliar jurisdiction.

Assume, for example, that a high profile individual has become the target of a foreign prosecutor’s investigation. The response will likely need to be immediate. Within hours, lines of communication might need to be opened. The individual will need to be met with and debriefed as soon as possible. If an independent investigation reveals the allegations are false, then evidence produced during that independent investigation might need to be provided to the prosecutor, affording him the benefit of that evidence when deciding whether and, if so, how, to proceed. With the benefit of that additional evidence, the prosecutor might reasonably conclude, on his own, that the allegations are false and, based on that conclusion, the case might be closed without the need for any additional action.

Accuracy

In the example described above, no statement would ever need to be made to the media. Conversely, when it is the media that first learns of and reports the existence of an investigation, a statement to the media might have to be made. That statement, however, will need to be inadmissible against the individual under investigation, inoffensive to the prosecutor, and 100% accurate.

Whether you are providing the results of an independent investigation to a prosecutor, or making statements about a case to the media, the information you provide has to be accurate.

Managing a high-profile or high-exposure crisis requires an investigation that will withstand cross-examination and media scrutiny. You cannot be negligent. You cannot be willfully blind. And absent a good reason, you cannot be wrong.

Even if a situation has no legal or law enforcement component, even if there is no public relations component, effective crisis management still demands an investigation that produces accurate, reliable information, because you will be relying on that information when making decisions about how to manage the crisis. The more accurate the information you have, the better informed your decisions will be.

Responsiveness

Responsiveness in crisis management refers not only to the speed of the initial response, but the ability to respond to a fast-moving, quickly-evolving situation.

In a crisis, there are things you can control and there are things you cannot control.

In a legal crisis, you cannot control the Government or its investigators, opposing counsel or opposing parties. You cannot control the witnesses, the judge or the jury. And you cannot control the facts.

In a public relations crisis, you cannot control the truth.

What you can control, however, are the plan and the team. The right team will help you respond to changing circumstances, even as the crisis unfolds.

If, for example, an international bank fails to respond properly to subpoenas and inquiries from federal agents and Justice Department prosecutors, what should be a non-issue could quickly become a problem with potential legal consequences. Outside professionals, however, can help defuse the situation and, moreover, provide recommendations to the bank to prevent similar problems in the future.

Similarly, assume a person is believed to be in danger in another country and, even several days after a law enforcement investigation has been opened, new concerns are being raised. Outside professionals might need to be engaged to bring additional capabilities and resources to the already ongoing law enforcement effort. Working together, the situation might be able to be quickly and safely resolved.

Manage Crises Effectively

A legal crisis can lead to incarceration, substantial fines, high damages awards, legal fees and costs, loss in share price or market value, debarment from government contracting, reputational harm and bankruptcy.

A public relations crisis can cause legal, commercial, banking and reputational problems.

A diplomatic crisis can cause a breakdown in relations, a weakened negotiating position, an inability to conduct operations, and worse.

To effectively manage a crisis, be fast, be right and be prepared for things not to go as expected. Think speed, accuracy and responsiveness.

 

This client advisory is intended to highlight certain issues and is not intended to be comprehensive or to provide legal or other professional advice. If you have questions, you should contact your counsel or other advisors and, on matters related to our work, we welcome you or them contacting us.

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