27 September 2017 at 08:00 BST

Digital dangers to reputation

Revenue loss and regulatory investigations are just some of the risks facing companies dealing with a reputational crisis, Jenner & Block partner Dan Rozansky says.

Reputational damage is top of the corporate risk radar for boards today and needs expert handling in the digital age, according to one of the US's top entertainment litigators. Speaking at the GC Futures Summit, Jenner & Block partner Dan Rozansky said revenue loss, loss of brand value and regulatory investigations were just some of the most common effects of reputational harm. Mr Rozansky, who is involved in some of the leading entertainment cases in the US, was chairing  a panel discussion - 'Fighting the spread of reputational harm in the digital age.'  He discussed how corporates should best approach a reputational crisis and what tactics were best to avoid long-term damage with Tom Stein, head of global partnerships at American Express, Michael Ellis, general counsel at luxury travel company Abercrombie & Kent and Benjamin Thiele-Long, associate director of public relations company Infinite Global.


The involvement of the legal team, both internal and external, when a reputational crisis hits was key, the panel felt. One of the biggest dangers was an immediate emotional response from business executives which often exacerbated the situation. Mr Stein, himself a lawyer, said that having a legal department involved avoided the emotional reaction. Indeed the legal department could act as a buffer in many ways until a proper response was co-ordinated. Nor was litigation  always the answer. Mr Rozanzky said one of the risks of using litigation to attack a story in the press was that it did not wrap up a situation either quietly or quickly. Sometimes, if you ignore a story, it fades away. Mr Stein was also of the view that litigation had to be carefully used. He said that American Express, as a company, was not litigious and had a policy of continuing engagement  'making sure the legal team are involved in proactive as well as reactive messages.'  The panel also agreed that involving external legal advisors  at an early stage was important as the benefit of privilege kicked in. 


It was also acknowledged that companies needed to have journalists whom they were familar with in times of crisis. Benjamin Theile-Long of Infinate Global said that approaching a journalist for the first time in a crisis was a high risk strategy. The panellists had different views on how difficult it was to get internet service providers to remove offending sites - with Michael Ellis, general counsel of luxury travel company Abercrombie & Kent, pointing to one success when his company had issues with a litigant in person. 


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