The financial sector has taken the lead in bad reputation over the past few years.
1. J.P. Morgan Chase
The worst mistake a firm can ever do when the reputation of a company is in the dumps, is to seek an opinion from the stakeholder. Interactive social media actions can be a perfect way to connect with stakeholders and rebuild the brand’s reputation. However, J.P. Morgan Chase learned the hard way that these actions could turn out to be a double-edged sword.
The bank had decided to have a Q&A session in advance for a session scheduled in New York. Few questions appeared during the first hours. Later, some responses started coming in. Some users chose to insult the executives or ask terrible questions about the bank’s recent corporate problems and legal issues, especially the case with the London Whale.
After some hours of this social commotion, J.P. Morgan Chase made a wise social media crisis management when it posted a tweet to end the session. Communicating with stakeholders is an excellent idea. However, when the average people have more bad that good to say about your firm, seeking for public opinions is a terrible idea. Consulting reputation management experts is advisable if a company is not sure of next steps.
The LIBOR scandal gave Barclays Bank a huge blow.The bank manipulated the LIBOR so as to protect the company’s reputation from the negative speculations in the periods of acute market stress. Barclays did the best it could at that particular moment so as to continue thriving in the industry.
A scandal without a human face on it can be very hard to fix in the public’s mind. As lame as it may sound, the company had to use defense strategy by first supporting the organization’s CEO. This did not end the massive amount of negative comments about the company, so the CEO resigned.
The bank had taken away its faces during the crisis, and this helped alleviate the numerous negative comments. Defense strategy can be a good weapon in the face of a crisis that is quite hard to handle.
The bank suffered intense shame after the revelations that there was systematic industrial-scale tax evasion by the rich at the Swiss subsidiary. A leaked list of over 100,000 clients at the Swiss branch of HBSC came to the limelight after a HSBC system engineer delivered it to the French government. The leaked list showed that the Swiss wing had helped over 8,800 British people to evade tax.
Lord Green, a former chief executive of the organization, expressed his regrets for not acting on the urgency of the problems before the bank was caught in by the tax evasion scandal. He confessed that he was not aware of the industrial scale of tax evasion. According to Lord Green, the theft data became apparent in 2010, and some of the executives were not aware of it until after the scandal.
Mr. Lord said he failed to use the benefits of hindsight to comprehend that there was a serious problem in the bank that needed close supervision. He was sorry for the mistake.
It is advisable to act on the danger signals than being sorry. Company heads should act promptly on any abnormal activities in the organization before it is too late. Either by resolving the issue directly or referring to a previous reputation case study about a similar circumstance. Here are some reputation management case studies for reference