The Modern General Counsel: Anatomy of a Crisis
Black swans — devastating, hard-to-predict events — have been happening with such regularity they can almost seem like business as usual, from the pandemic to supply chain disruptions to vocal protests about societal issues. In these moments, the General Counsel plays a crucial role in preparing, advising and working with C-suite members, boards and other departments across the company to navigate legal and regulatory challenges, manage investigations and develop communications strategies to move beyond the crisis.
But what are the phases to think about as they respond?
Anticipate
It is not a matter of if an event will occur, but what it will be and when. Anticipating potential threats and implementing the right level of preparation and governance before an event occurs safeguards an organization’s continuity, operational success and reputation among stakeholders. By thinking through and planning for a crisis in advance, a company can swiftly and decisively respond to a situation and, in the process, maximize operational response and establish confidence among colleagues, employees, customers, investors and other stakeholders.
Activate
Regardless of the form it takes, every event has the potential to harm a company’s reputation, value and license to operate. In this age of around-the-clock scrutiny, companies are often judged as much by how they respond to crisis as the crisis itself. Effective response requires swift and consistent action that demonstrates accountability and transparency without increasing legal exposure, financial liabilities and reputational setbacks. Response teams — internal and external, comprising legal, operations, communications and forensics, among other functional leaders — operate as one.
Assess
Crises involve a key inflection point between event and fallout. Post-incident, a company must assess what regulatory, legal and commercial risk remains and how to move forward to rebuild. Transparency, accountability and continued stakeholder engagement after the event’s conclusion are also critical to both rebuild key audiences’ trust and confidence in the company — and to protect, promote and enhance the long-term success of the business. Learning from responses will prepare organizations for future incidents if and when they occur.
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