Just a few short years ago, Scottish beer company, BrewDog, was charming the pants off the media.
The brand was cool, so was the boss, and it did cool things like introduce ‘pawternity leave’ – maternity-style time off for staff with a new pet. But in 2021 came accusations the business had a culture of “intimidation and fear” and suddenly the firm was not quite as media-friendly.
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Much like the royal family, which is dealing with the similar problem of being attacked from the outside by former member of its inner circle, BrewDog has largely followed a ‘no comment’ policy.
An initial apology and a statement saying it would hire a culture consultant was pretty much it (HR magazine contacted the company for comment). But is the BrewDog strategy (if it is indeed a strategy), a model that HR should follow if they find themselves in the eye of a media storm?
Traditional crisis management theory suggests it is not. “Allegations are typically the result of something going wrong in the business, and so must be taken seriously,” argues former PR professional-turned issues and crisis management consultant,
Sheena Thomson. “When events like this happen, it’s a sign of failure and HR has to be integral to the response,” she adds. “This includes liaising with all stakeholders – internal and external.
“Hoping things simply blow over is not wise. If you don’t respond with a narrative you can control, things can get worse and out of control.”
Sophie Bryan, founder of development consultancy, Ordinarily Different adds: “Saying nothing or hoping the news cycle will pass can do more harm than good, as it can be perceived as a lack of concern or accountability.”
The problem, of course, is that no two crises are the same. This is something some admit makes planning a standard response difficult – especially if the allegations against it are viewed as being vexatious.
“The problem with unfounded allegations is that, if unchallenged, they may become widely believed,” says Tariq Khwaja, managing director of crisis communications firm, TK Associates.
“This ought to warrant a robust defence.” But even here, he urges caution. Khwaja recently managed an incident where a charity was being publicly shamed by a disgruntled employee who had been let go for poor performance.
He says: “As the accusations were groundless, a strong response was in order. But at the same time, it would have been inappropriate, and potentially damaging to the charity’s reputation, to have gone public with too many specifics.
So, a response calmly and clearly presenting the charity’s position, but declining to go into details, was the most suitable solution.”
Because allegations can be complex some say ‘no comment’ could indeed be the wisest policy – or that HR directors should at least take a step back first.
“I think the first thing HRDs really have to ask is: ‘is this a crisis?’” asserts George Hutchinson, CEO of crisis response business River Effra.
“If it only lasts a day, and it will pass, then let it pass. What’s more important is for an organisation to decide what its objective of dealing with a crisis is. Then only fight what it wants to win rather than let a crisis get the better of it.
“Here HRDs can be great allies as the trusted counsel an emotional CEO may not want to hear.”
Hutchinson’s sentiments are echoed by Anastasysia Saraeva, lecturer is reputation and responsibility, Henley Business School. She says: “It’s often forgotten, but HRDs need to consider how the public are actually reacting.
“Research suggests that if people naturally disassociate with the person or people making the allegations, then support actually rises for the organisation.”
She adds: “Before the extent of the Volkswagen emissions cover-up was later uncovered, initial polls in Germany found that people actually trusted the car maker more.”
Saraeva cites firms like Amazon, which no matter how many claim of substandard working conditions come out, seems remarkably resilient reputationally.
This is because, she says, “it sticks to what its customers expect of it, which is exceptional service and delivery speeds”.
Perhaps this is why BrewDog responded as it did. While the story might have mattered to HR journalists, to customers it arguably barely registered. Last year BrewDog’s bar business reported revenue growth of 31% and record sales.
In 2021, the year the allegations broke, revenue rose 21% to £286 million. Supermarket distribution was also up. What experts do seem to agree on is for people leaders not to put their heads in the sand. Hutchinson says: “You can’t talk yourself out of something you’ve behaved yourself into.” But they also counsel proportionality.
“Your response should depend on the validity of the facts, the impact of the facts, and whether those facts contradict the values of the business,” suggests Matt Phillips, who spent a decade in corporate communications at the BBC and also in the record industry when it was in decline and suing consumers for illegal file sharing.
He adds: “Reputational crises certainly occur when the walk doesn’t reflect the talk. But while it’s better to engage with the facts alone and not hide, it’s also important not be bounced into making an apology before you’ve established the facts.
“When you do put something on the record, stick to factual company statements that aim to rebut any misinformation, and never make things personal.”
If there is a real problem, Hutchinson says, it will need fixing. “Organisations are typically very bad at holding their hands up,” he says. But often he suggests an internal approach (rather than an external press release) works best.
“The outside might be pressurising for answers, but you have to tackle the inside first,” he says. “If you go outside and stretch credibility, then the inside will call you out. With HR being custodians of company culture, it’s for them to determine whether it’s been upheld or not.”
Whether the royal family have got its response right only time will tell. But as Khwaja says: “While the problem for the royal family is that keeping quiet gives Harry a clear, uncontested platform to tell his side of the story, it does avoid amplifying the issues and might just keep ‘The Firm’ on the moral high ground.”