On October 25, AmCham hosted the third session of its Government Affairs Workshop series, Crisis Management Strategies. Brunswick Partner Dr. Lu Jianzhong and Brunswick Associate Mr. Liu Baijia provided an overview of strategies and best practices for how Government Affairs (GA) practitioners can effectively manage crisis situations that ranging from unannounced government inspections to public scandals.
Dr. Lu noted that crisis management, in a government relations context, was becoming more challenging as the stakes get higher. He added that crisis can be triggered by a number of factors, including, behavioral failings, corporate issues, operational events. He cited a number of recent cases as examples of how to and how not to respond to crisis situations. Dr. Lu also highlighted that there are an increasing amount of investigations relating to anti-trust, corruption and the quality of investments and conduct. Pricing has also become very sensitive for consumers and can make companies the target of investigations.
Mr. Liu discussed the increasingly large and changing impact that the media has on crisis situations. In particular he noted that the Chinese media environment is very complex, especially with the unique and powerful role the government plays via state owned media-outlets. He said that the media landscape is changing rapidly with the use and role of social media which raises its own set of challenges given the speed and accuracy (or lack thereof) of social media reports. Both presenters recommended that companies have an effective crisis plan already developed before the crisis hits. Companies that have this in place, will generally handle the situation better and with fewer mistakes. Additionally, companies need to know who their stakeholders are, both within and outside the government, to better understand where the next crisis may come and how they should respond.
A panel discussion followed the presentation where Director of Government Affairs at Praxair, Ms. Brenda Azuma and Senior Vice President at FleishmanHillard. Mr. Yisi Liu emphasized the need for companies to work cooperatively with government officials during a crisis. Ms. Azuma agreed and said that it was important to have crisis management teams in place before problems occur. They also discussed their own best practices and took questions from the audience.