CEO problems and crisis management

I posted recently about the damage to the corporate and personal reputation of BP and its CEO, John Browne over the attitude shown towards shareholders regarding executive payouts.  Now it seems Browne had his mind on other matters as he leaves the company over a lie to the court regarding his private life.

Apparently a four month battle has been ongoing with the Mail on Sunday over allegations regarding a personal relationship with Jeff Chevalier, his Canadian partner between 2002 and 2006.

When someone has a solid reputation in business – and Browne was rated as one of the best in the business in annual CEO surveys – it seems surprising when their judgement is affected by personal attachments.

There should be no issue over Browne’s sexuality, but if company resources were misused and lies told under oath, then his credibility and reputation is destroyed.

In the case of squabbles with shareholders, corporate PR responsibilities will lie with the executives in terms of presenting the company perspective and implementing crisis management plans. 

In the case of a crisis caused by the actions of individual executives – especially when these relate to their personal life – public relations is unlikely to be directed to assist the individual.  In such cases, the CEO will find himself without the expert PR counsel he has relied on within the organisation – and will probably need to employ his own experts to manage media relations and try to recover a personal reputation.

Is this an argument for CEOs to employ their own PR counsel during their careers rather than rely on the in-house team, like sports stars do?  Or would that cause problems when the personal and corporate best interests are in conflict?

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Heather Yaxley

Heather Yaxley is passionate about PR - teaching the CIPR qualifications, lecturing part-time at Bournemouth University and running the Motor Industry Public Affairs Association (MIPAA). I'm undertaking a PhD looking at Career Strategies in PR. I love sharing ideas and knowledge - connecting news and views by blogging on public relations and educational developments, especially relating to accelerated and active learning. I'm also a published author, qualified trainer and experienced consultant.

9 thoughts on “CEO problems and crisis management”

  1. Heather, I thought of your post when I read the following article in Friday’s Careers section of the Globe and Mail. Which CEO do you think would benefit more from the in-house PR counsel?!

    “Sex, lies and public scrutiny”

    Lying. Love. Hormones. And gonads. Together they form the fatal, ubiquitous quicksand of the workplace, sucking in clerks and CEOs with equal finality, especially the guys. This week they took down BP PLC’s John Browne, who resigned his job as chief executive officer after it was revealed he’d told a lie about his homosexual lover–a silly, inconsequential lie as it turned out–in court.

    http://www.theglobeandmail.com/servlet/story/LAC.20070504.CAVALPY04/EmailTPStory/

    BTW, in today’s Globe (Saturday), there is yet another article, saying that Browne’s ex-lover has skipped town:

    “The whereabouts of Jeff Chevalier remained a mystery yesterday with his former lover suspecting that the 27-year-old Canadian, who single-handedly brought down a British oil tycoon, is holed up somewhere until his story is published in a London tabloid newspaper that bought it….

    …After Mr. Chevalier’s relationship with Lord Browne ended last year, he threatened to embarrass the oil tycoon, according to a court ruling. Mr. Chevalier alleges that Lord Browne used BP money to support him and shared company secrets.

    Lord Browne denies those allegations. BP chairman John Sutherland said in a statement that the company has investigated the allegations and found them baseless. The scandal has left the blogsphere buzzing with theories and opinions about the relationship between the business tycoon and the Canadian”.

  2. PR Week in UK headlined that Browne had signed up high profile external counsel after working with the in-house guys for a couple of months trying to keep the Mail on Sunday at bay.

    In many respects, I’m with the French on affairs of the heart (or other bits of the anatomy) – it is because we (especially the media) makes such a big deal about it all that it leads to the lies. There are many worse behaviours from a CEO and maybe one who is a bit dippy in the love department at least shows they have a heart. Unlike some…

  3. This one is bizarre – as you say, in many ways there was a no story given that Browne had been public about his relationship – but still it was the purience that got him – here that he might have been paying for the relationship, either at the start or later on. Again, would the French care?

    Thanks for the link – good graph – and Pete Blackshaw’s reasons to stop blogging. I work for myself and can find the time by giving up other things such as junk television, but it does take commitment and there are times it feels a bit obsessive. But I believe there will be something robust from new/social media, once the hype fades away.

  4. I once had a proper job and had to appoint a PR Agency. After we had decided on the company they threw me a curved ball by asking me what was our PR strategy.

    I thought for a while, not too long because I wanted them to think I’d clearly thought it through beforehand.

    “Well, when there’s bad news attaching itself to us, or God forbid we are the cause of the bad news I want you to keep us out of the media. The rest of the time I want you to get us into the media.”

  5. I would expect to discuss the PR strategy before pitching for an account. Anyway, you seemed to have a sound media relations approach – presuming that internally you had a business strategy to reduce the risk of bad news and encouraged a culture where positive newsworthy matters occurred.

    As I’m sure you appreciate, PR needs to relate to the organisational goals and strategy to be truly effective rather than being an invisibility cloak that enables companies to hide or appear at their will.

  6. Heather, we had all of those things. But it was an airline, and they had, and still do, if some of the low cost carriers are anything to go by, a somewhat seat of the pants existence. It’s one of those businesses where the speed it moves at, the geographical spread, the risks, the dynamics and not forgetting the knife edge of profitability that they straddle that makes it more difficult to strategize.

    I’m not saying it’s impossible but it certainly tested the creativity of all those involved in PR.

  7. Ah, that’s what is known as “adaptive strategy”… I am very interesting in concepts relating to chaos and complexity theories in relation to PR and management. I feel that too much attention has been given to linear models and approaches which don’t recognise sufficiently the external world and the speed at which it is changing. Also we need to not see the company as the centre of the universe since publics exist and communicate, and issues develop, outside our influence and control.

    I feel it is more akin to being a firefighter – where you need to be skilled in decision making based on training and knowledge of scenarios, but be flexible and dynamic in adapting to the complex, often chaotic world in which we are trying to manage communications.

    Strategic planning increasingly needs recognition of core or essential aspects – such as organisational values and purpose – so that management can be proactive and/or reactive tactically, whilst supporting the organisation’s reputation and other strategic assets.

    Micro-management and fixed plans don’t seem to me to be geared to respond to the type of dynamic environment faced by many organisations, particularly when financial survival is what keeps the CEO awake at night (as opposed to affairs of the heart).

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