What to do when bad news breaks (that isn't quite true)

Thursday 1st April 2021 Justin Cleveland

Late last week, a respected journalist posted a story on Twitter that AMP's group chief executive, Francesco De Ferrari, would resign by the end of the day.

The story sent ripples through the markets, causing a trading pause for the Australian institution.

Several hours later, the organisation released a single sentence response saying that De Ferrari remained in charge.

What was likely happening was that tense discussions were happening between the board and embattled chief executive and his resignation had been floated.

The problem, of course, is that in that moment the story simply wasn't accurate.

When you face a circumstance like this - when a story comes out about your organisation that is either premature or simply not true - what should you do?

Crisis comms specialist and BlueChip Communication founder Carden Calder says your first stop should be to create an accurate, fact-based story that contests anything that's inaccurate, "similar to a court filing."

The most important things here are to get the truth out there quickly and clearly. "How quickly and how you communicate often depends on the velocity and volatility of the issue and whether it's your issue alone or you're one of many affected," says Calder. "9/11 was almost instant, requiring a real-time response particularly from insurers and asset managers exposed to airline and insurance stocks. The GFC by contrast had some high velocity high impact events like Lehmann’s collapse but also had a slow-burn impact on financial markets and asset managers. COVID19 for most in financial services was somewhere in between."

Calder was the comms lead for a listed insurer on 9/11. When that event occurred, her priority was establishing any potential financial exposure across reinsurance arrangements, the investment portfolio and reserves, and communicating that information to the ASX – or as soon as was possible as it happened overnight in Australia.

By contrast, the GFC and COVID crises were more fluid and rolling. "For certain fund managers during the GFC, one of the first priorities – after coming to grips with the impact to their institutional and wholesale investors – was an issue of equitable wind-down or liquidity solutions over weeks, months, and years."

COVID, by contrast, had a slow build that gave institutions more time to respond and consider disclosure and communication requirements.

Tell the truth

"You can't handle the truth," Jack Nicholson famously screamed in A Few Good Men. And, you know what? He might be right. The truth might be depressing. But, Calder says, you need to be upfront and honest.

"Tell the truth," she says, "even if it's not flattering.

"Do so in a way that reflects the full story."

When you're telling the truth, you're going to have to back it up. Unfortunately, nobody is going to take you at face value when responding to a crisis so you're going to have to support your arguments. It circles back to her initial point about responding in a way that is fact-based and airtight.

If you do fudge anything or lie – even unintentionally – that can be thrown back in your face in the future.

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