CSR is not a shield against corporate missteps

The recent fortunes and misfortunes of BP demonstrate how fragile a corporate reputation can be in the face of a crisis.

The recent fortunes and misfortunes of BP demonstrate how fragile a corporate reputation can be in the face of a crisis. This real-life drama also shows how quickly public opinion can turn, as well as how rapidly the situation can deteriorate to the point where it invites intense government scrutiny into a company's activities and operations.

BP and a multitude of other companies have invested considerably over the years in programs and efforts to demonstrate that they are responsible corporate citizens. BP's “Beyond Petroleum” campaign has been a case-study on a well-executed responsibility and reputation management program for almost a decade.

The catastrophe in the Gulf of Mexico, however, has been a game-changer to say the least. The good will BP built up over the years is eroding quickly. An important side lesson from the situation that the company currently faces is that it cannot rely on corporate responsibility programs to shield it during a crisis.

The same goes for cultivating relationships within the government. Forging good ties with members of government and their staff – at the state, regulatory, and federal levels – is important for both communication and advocacy purposes.

But if the situations that have confronted BP, Toyota, several financial institutions, a handful of military contractors, and other companies over the past year and a half are any indicator, relationships between corporations and lawmakers or regulators are precarious at best and adversarial at worst. Lawmakers' attention (and indignation) can also turn on a dime, and they are responsive first and foremost to the insistent, commanding voice of their constituents.

This is not to say that the CSR and government relations programs and teams aren't a vital part of helping a company weather the storm during a crisis. They are. However, these functions by themselves won't be able to inoculate a company from the consequences of bad decisions, malfeasance, or, in many cases, just plain bad luck or unfortunate circumstances.

Corporate responsibility efforts are both worthwhile and extremely valuable endeavors for companies, employees, shareholders, and customers alike. People want to be associated with companies they feel are doing the right thing by their fellow man and the planet we all share. Most of the time, these efforts build a bank of good will that, when nurtured over the years, serve companies and their employees well.

The key, then, is to avoid squandering that good will by not allowing shortsighted policies, lack of leadership and direction, or breakdowns in the decision-making chain to harm a company's reputation. CSR should never be confused for some kind of antidote to a company's malfeasance or negligence. It belittles the investment and emotional commitment a company makes in it and is insulting to all of the stakeholders involved.

Robert Tappan, a former senior official at the US Department of State, is president of The Tappan Group, a public affairs firm based in the Washington, DC area. His column looks at issues advocacy and related public affairs topics. He can be reached at tappan@tappan.org.

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