IPRS Lunch Talk - Communications in the Current Financial Crisis
10 December 2008

The world is facing its worse financial crisis. The signs of the approaching catastrophe were there. One thing led to another: the sub-prime mortgage crisis; soaring crude oil prices; the September 2008 plunge in stock prices; the collapse of some of the world's who's who in finance, investment, banking, home loans and the lot.

How could the world not feel the shockwaves? As we all know, our open economy has not been spared. From major financial institutions to retailer financial investors; from major corporations to SMEs, and even the Government, we've all started to feel the crunch.

As we usher in 2009 and welcome the Lunar Year of the Ox, everyone is bracing for even more hard times ahead. In the midst of so much hardships and uncertainties, how do organisations cope? How do they assure their stakeholders, their customers and their employees that they are doing their best to set things right? How do they work with the media in such troubled times?

Communication!

Picture (from left): Money K, Andrew, Daphne, Moon Yee and Lee Miller

IPRS organised a Panel Discussion on 10 Dec 08 on the importance of communications, internal and external, in a crisis. The speakers comprised Money K, Managing Director, Marketing and Communications, Citi Global Wealth Management; Mr Lee Miller, Editor-At-Large, Bloomberg News; Ms Tham Moon Yee, Managing Director, Stratagem Consultants; Mr Andrew Thomas, Managing Director, Ogilvy Public Relations Worldwide; with Ms Daphne Liew, Managing Director, NBS Consulting and IPRS Council Member as the Moderator. The speakers shared valuable points on communication methods that had been adopted by their respective organisations.

Picture: Tham Moon Yee sharing her views

Tham Moon Yee noted that many companies in Singapore did not have strong annual PR budgets as compared to their global counterparts. Many companies viewed PR as a ‘discretionary' expense, which was, in some cases, even cut in times of an economic downturn. Moon Yee highlighted the
following concerns:

• What would the effect be on the reputations of local businesses going forward if they trimmed their PR budgets in the downturn?
• Should PR budgets actually be increased in times of crises as the need to shore up confidence and allay the fears of stakeholders?
• Or should PR be used only as a "smoke-screen" for companies to buy time until the turnaround comes?
• Or should PR be used to chart new directions as a company seizes opportunities in a crisis?

Tham Moon Yee added that Corporate Transparency and Corporate Governance were vital as they were the essence of good PR in a financial crisis. She was added that PR was important in managing expectations, perceptions and issues. Honest PR was vital to win the trust of company investors and customers. This trust was maintained by regular communication - briefings on how the company was managing its financial position and on business issues.

Picture: Participant taking down some pointers

For Money K the current crisis highlighted the power and influence of the media. He urged the participants to continue to pro-actively engage the media on a regular basis, be it with good news or bad and not hide behind press releases. Money K added that with today's technology, the speed at which
news spread often led to a crisis of confidence which was a very challenging and difficult task.

Money K suggested that conventional notions of PR and communications might not necessarily be the most effective solutions in today's crisis. Instead, he encouraged the use of validation by third parties to substantiate one's position. Money K said that it was vital to keep the lines of communication with customers open at all times. It was also better to err on the side of over-communication.

In terms of employee communication, Money K highlighted that in difficult times, employees may display fears about losing their jobs; be cynical or suspicious about management's motives; and demonstrate a loss of confidence in the company's overall health. He added that as employees
were critical to all communications efforts, as their conduct and confidence affected both other internal as well as external stakeholders, it was imperative that they were actively engaged. Money K highlighted that one should communicate the Business Recovery Plan clearly and directly to all stakeholders - employees, clients, and the media, regularly.

"Your reputation has to emerge stronger and not weaker from the crisis.. Good communication helps. You keep something unanswered for a day, and companies will start becoming skeptical as to why you are keeping mum," said Money K.

Picture: Lee Miller sharing his views

Giving the media's take on the current crisis, Lee Miller urged organisations to always be honest and open and to be prepared to put at least something on the record. Lee said that being human, journalists wanted to present events in
complete fairness, which meant covering it from different angles. Lee Miller shared a couple of media tips including ensuring that media lists were regularly updated and the need to prioritize the media in terms of time horizon and reach.

According to Andrew Thomas, "PR is at a tipping point. The recession is accelerating the remodeling of our industry because what clients need and want now are strategic partners who offer brave counsel that goes straight to the heart - and head - of a brand, solving macro and micro business issues as well as communications-related ones. As a strategic business partner, our first recommendation is ‘get into the conversation and stay in it', no matter where that conversation is taking place. Companies who listen, who keep talking, who engages at all touchpoints with all stakeholders and build trust will emerge, post-recession, as both brand, and thought, leaders."

IPRS Lunch Talks take place on a monthly basis and address current issues pertaining to the industry. For a calendar of forthcoming IPRS events, please visit www.iprs.org.sg.

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