Corporate scandals can be averted with good PR

On most days, companies will be able to avoid harsh public criticism. Corporate scandals are more of an exception, and getting really negative publicity in the media is quite unusual. But when it does happen, it can have dire consequences for the business and its key people.

In fact, scandals and corruption are the most common reasons why CEOs of the largest companies are forced to leave their positions globally. As public relations can play a crucial role in sustaining the reputation of a company and its leadership, it’s highly probable that good PR could have helped them avoid this fate.

Good PR can help avoid a media crisis

There are of course companies that have been hit by completely unpredictable negative publicity. While they themselves did not foresee it, even an external PR expert would have found it difficult to foresee many of those situations. However, this is the exception. In the vast majority of cases it was clear that reputational damage risks existed and, with the right preparations and responses, it would have been entirely possible to avoid the negative outcomes.

For example, it is not difficult to predict when someone within the company may do something bad due to incompetence, poor judgment or downright fraudulent behaviour. It could be someone from the IT department that happens to expose a server full of private customer information to the Internet without adequate data protections in place.

This is precisely what happened some time ago to a company that handled patient care information in Sweden. In the end, it was probably lucky that it was a tech journalist who discovered the mistake and not a hacker. The scandal could have been even significantly worse if someone had published the patients’ various diagnoses online. Not to mention the damage to the affected patients.

Risks can be mapped and spokespersons trained

No PR agency could not have prevented such an event. However, a good PR agency can help predict what could happen in a worst case scenario, and point out the risks, well in advance. We can do this because we know what the media are looking for and want to write about, as well as what other companies have experienced in terms of negative publicity.

Unfortunately, far from all companies are aware of where the risks to their reputation actually lie. There is simply a lack of systematic and regular screening. And this is where a public relations agency can make a great difference, by looking at the situation from the outside and describe how the company and its industry are perceived by the public. We can create a list of risks discovered and look at both how likely they are to happen and how serious they are.

What we can do then is suggest how best to deal with the particular type of event in question. We then train spokespersons in how they can proceed. This preparation means that the company will not be caught red-handed. In addition, and what is perhaps even more important, an increased awareness of the risks makes it possible to work internally to reduce them or their impact.

The best crisis is a crisis that doesn’t happen

Once a corporate scandal has broken, it is often too late to do much more than try to control the damage. Avoiding it altogether would have certainly been much better. This is often possible, and a key action is to give the right answers to the very first questions from journalists.

Another effective and sustainable approach to minimize the impact of a crisis is to proactively cultivate a positive image of the company with the public and its target audience. Here’s a good example from another Swedish company that has occasionally found itself in bad weather: IKEA.

Over the years, there have been reports that IKEA’s founder had Nazi connections in his youth and that the company has made some questionable investments. Despite this, not many people have negative things to say about IKEA. One reason for this is that the company has proactively cultivated a positive image of itself over time. They have systematically engaged with the media and consistently conveyed a positive narrative about their brand.

What this means effectively is that criticism doesn’t necessarily leads to disaster when there’s adequate oversight and planning in place. The public currently sees the brand in a positive light and mishaps might affect that, but they won’t turn it into a PR predicament.

A positive media image is good insurance

On the other hand, some research suggests that when a brand receives criticism where public perception was previously neutral, the impact can be severe. This negative portrayal can tarnish the brand image, and reversing it to a positive public perception can be challenging.

Creating and safeguarding a positive brand image can therefore play a crucial role in preventing future crises. Perhaps creating and maintaining a positive brand image has become the essential task for any long-term public relations campaign. Companies need to focus on building brand equity and reputation by communicating their values, mission, and culture consistently. They should engage with their stakeholders, including customers, employees, investors, and the media, to promote transparency and establish trust.


Michael Falk is the Managing Director of Agera PR