Legal spin: what to do when PR disasters strike

These days when a crisis hits a company it can do more than just damage a brand’s reputation – it can dent value, damage earnings, and take a long time to recover.

What’s more, the fallout from a PR disaster is being amplified by the rapid spread of information in an increasingly fast-paced digital world, especially when content goes viral.

Australia’s legal industry is no stranger to public relations disasters, with major firms like MinterEllison, Maurice Blackburn and Slater and Gordon among those that have experienced high-profile public relations issues in recent times.

Sally Branson, principal of public affairs consultancy SBCG, says law firms need to realise that in the digital era no industry player “is immune to a reputational crisis”.

“No one is too big, but equally some firms think they are too small  – everyone has vulnerabilities –  which can begin as internal issues quickly escalate into a public relations emergency with far-reaching consequences,” the Queensland-based Branson says.

“This year’s situation provides valuable lessons for all legal practices, regardless of size or specialty.”

The “first reality” firms must now accept, she says, is “crisis isn’t a matter of if but when”.

According to Branson, the legal profession has had suboptimal crisis management in the past by assuming that high professional standing provides immunity from reputational damage.

“This is dangerously outdated. In today’s interconnected environment, issues can escalate from internal concerns to public scandals with remarkable speed.”

 ‘Slow burn’ disasters

In the opinion of Branson – former prime minister Tony Abbott’s senior press secretary – crises that end up engulfing law firms tend to start out small and build over time.

Rather than being sudden catastrophes, they are usually “slow burn” or “creeping” situations that emit low-key alerts before erupting into the public domain.

Common signs of these sneaking PR disasters, according to Branson, include rising cultural issues within a firm, unaddressed leadership conflicts, patterns of client complaints and operational flaws that compound over time.

“These slow-burn situations create a false sense of security – they seem manageable until suddenly they aren’t. By the time they attract external attention, containment becomes exponentially more difficult,” she warns.

At this juncture, a speedy and clear response is more critical given the danger of harmful content going viral, Nicole Phillips, managing partner at PR agency HAVAS Red, says.

But before such a response “every effort” needs to be made to find out what has happened and managing it “to give an organisation the basis for communication”.

“Acknowledging the issue quickly, clarifying the facts and sharing the immediate action being taken is essential,” Sydney-based Phillips says.

Containment is key

Simple moves here are to appoint a spokesperson to ensure consistent messaging and to work with third parties like cyber security and police to contain the situation quickly.

“That’s critical to maintaining trust and confidence by stakeholders,” she says. “Being prepared, having an issues playbook at the ready so that a crisis of any scale has considered, and pre-prepared methodologies to front foot the crisis is key to managing an issue.”

The worst thing law firms can do, in today’s hyper-connected world, is to delay a response or downplay an issue, which risks a “vacuum of information”.

That is because the empty space is quickly filled by speculation and assumptions made by various stakeholders including staff, the public, media and clients, Phillips says.

Without the “guardrails” of clear communication from the moment the crisis occurs, reputational risk increases exponentially as trust erodes.

Hence, Phillips, echoing Branson, urges law firms to do heavy lifting before the crisis hits – recommending firms spend about 70 per cent of effort before issues explode.

Doing work to head off a crisis is especially important inside law firms as they are very complex organisations that “work at the very edge of disputes, litigation, crises and issues, and each practice group has its own operating world”.

“Most law firms have a partnership structure – meaning below the executive team there are dozens and sometimes hundreds of partners with equal standing – they are professionals used to having their own view and taking control of a crisis,” Phillips says.

Round-the-clock response

When the crisis does hit, Alicia Grabowski, managing director at Project PR and Media, nominates a few key planks of a good PR response in today’s fast-moving world.

Grabowski, a former TV news reporter, says the plan should encompass internal messaging, media messaging as well as getting a skilled PR representative on board who can deal with the influx of media approaches.

Strategic planning, which includes key messaging and important staff being media trained, is also essential in addition to round-the-clock monitoring of social media.

“This plan is executed as soon as there is any slight issue. At times this execution can kill the crisis altogether or it will at the very least have the crisis dealt with in the best way possible leaving the least amount of reputable damage at the end of it,” Grabowski says.

Unfortunately, many firms fail to execute this kind of plan, she says.

One common missteps, right up front, is not releasing a media statement and “basically hoping the crisis will go away despite all of the internal members knowing about it”.

“It won’t. By the time it’s become a PR crisis it’s often too late unless it’s been dealt with appropriately,” Grabowski says.

“Media should always be provided with a statement as well as answers to their questions.

“If senior key members of the business have been properly media trained, there is no excuse not to provide an interview to the media and have them steer the interview in a direction that can extinguish the crisis.”

Branson, meanwhile, sees patterns in how crisis-hit law firms get their responses wrong.

One big error, in her opinion, is firms that prioritise external messaging while leaving staff uninformed, leading to distrust and potential information leaks internally.

Another common pitfall is failure to appreciate how fast a crisis spreads online, something Branson terms “digital underestimation”.

She also sees unhelpful “defensive positioning” from law firms, which she suggests may stem from legal training that “can produce overly defensive responses focused on liability rather than accountability – a stance that typically backfires in public perception.”

Media-Wize co-CEO Kathryn Goater also highlights problems with how firms frame crisis PR.

Mindset shift needed

She says there is a clash between legal strategy and media strategy, with lawyers trained to minimise liability and protect reputation through precision and control, while journalists look for accountability and narrative.

“Tactics that serve well in court often backfire in the court of public opinion,” Goater says.

On a practical level, she advises lawyers to avoid saying “no comment” and to use plain, easy to understand language in the place of legalistic and jargon heavy terms.

She also urges lawyers not to “try stonewalling or delaying as it will backfire”.

“And please don’t threaten journalists and media outlets with legal action, doing so will antagonise and make them much less sympathetic to your side of the story,” she adds.

“Many reporters will view it as intimidation and that you’re trying to silence the truth. They will dig deeper and talk to more people and the story will only get bigger and last longer.”

HAVAS Red’s Phillips urges firms to pay special attention to internal communications.

Authentic, honest and transparent correspondence with staff is critical, she says, because employees act as a firm’s “ambassadors” and an extension of its brand, making early and regular accurate communication with them vital in a crisis.

“Internal comms may appear more challenging at the time of a crisis, where control and containment is key, but anything less than transparency will be discovered and the company will be held accountable,” Philips says.

Similarly, Media-Wize’s Goater points to the importance of keeping staff constantly in the loop as a crisis unfolds, saying it is especially key in the first 24 hours.

Even when all relevant facts are not yet known, she says staff should be updated early on about what is happening in order to buoy morale.

“It is too late to fix a negative or distrusting culture in the heat of the moment. Engagement with staff and fostering a supportive and trusting culture should always be a priority.”

Getting the PR response right matters given the heavy impact PR crises can have on a company’s reputation and also its earnings, according to recent research.

The research, published in April by communications consultancy SenateSHJ, found that when a crisis strikes investor reactions can be swift and brutal.

The Sydney-based consultancy’s survey of 300 reputational crises over the past 40 years, found share prices fell an average 35.2 per cent following a reputational crisis, with companies taking 425 days on average to recover to pre-crisis stock levels.

“For some, recovery took years – or did not happen at all,” the report added.

Reputation rehab

Looking long term, a big issue is how to restore public reputation and industry standing.

The Australian Institute of Company Directors says firms should start their crisis planning with the aim of ending up in a better place reputationally than before the crisis hit.

It is sentiment SBCG’s Branson agrees with, although she cautions that the digital footprint of a crisis, which persists long after the acute situation resolves, needs addressing first.

“Effective management includes developing new, positive content that helps displace negative coverage, systematically rebuilding relationships with affected parties, documenting organisational learning, and tracking reputation metrics to gauge recovery.”

Goater agrees that the work must be long term, emphasising a firm’s values.

“If you comment succinctly, clearly, non-emotively, focus on the facts, demonstrate regret and empathy, outline the steps being taken to remediate the situation the news cycle will move on much faster,” she says.

Long-lasting recovery from a PR crisis also means repairing the root cause of the disaster, according to global consulting firm Mckinsey & Company.

That is due to corporate disasters usually involving people issues like culture and capabilities, processes like risk governance or performance management, or systems.

These are things that take a lot of work to repair, it says.

“They may span the organisation, affecting hundreds or even thousands of frontline leaders, works and decision makers,” the company says.

“Tackling these is not made any easier by the likely circumstances at the time: retrenchment, cost cutting, attrition of top talent, and strategy reformulation.

“For all these reasons and more, repairing the root cause of any crisis is usually a multiyear exercise, sometimes requiring large changes to the fabric of an organisation.”

Branson believes that if you do the work, a crisis can end up actually being an opportunity.

While no firm wishes to face a crisis, they often present unexpected chances for organisational growth, she says, adding that firms that respond effectively “frequently emerge stronger, with improved systems, greater transparency, and renewed purpose”.

“The challenges faced by Slater and Gordon and other firms remind us that reputation is both precious and fragile,” she says.

“By adopting a truly holistic approach to crisis management- one that spans leadership, operations, culture, and communications – law firms can transform potential disasters into demonstrations of their values and resilience.”