The global financial crisis that began erupting in September 2008, and continues today, has been this generation’s single best opportunity to execute cohesive, thoughtful and thorough crisis communications strategies.
The worldwide extent of the crisis also provides a unique opportunity to examine a broad range of reactions within a single industry that provide reasonably accurate and reliable results.
The Milan communications consultancy Lundquist Srl seized this opportunity and “evaluated the quality of the English language versions of the corporate Web sites of 51 of the world’s largest banks” in the US, UK, Europe and Japan. Lundquist presented its research conclusions at a February 2009 workshop of the World Federation of Exchanges in Zurich.
The best companies confronted the crisis head-on and were proactive in their online communications. Those institutions…
- Published comprehensive information.
- Explained how they were (not) affected by the crisis.
- Provided their views on the extraordinary market conditions.
- Responded quickly and provided helpful links, making the information easy to find.
- Used interactivity and their messages were tailored to be meaningful to the largest possible audience.
Those companies that demonstrated these communications leadership characteristics were four: New York Life, Danske Bank, BNP Paribas and Swedbank.
That, unfortunately, leaves 47 financial services institutions that didn’t fare too well.
What failure looks like
This lack communications performance was not the result of a similar paucity of stakeholder interest. During that period late in 2008, “heavy traffic increases were recorded on top investment/finance and business Web sites such as Yahoo and Google Finance,” where searches for ‘financial crisis,’ ‘stock market’ and ‘core capital’ were up 500% from a year earlier.
In disclosing this information at the Zurich meeting, Lundquist stated:
“The world’s largest banks failed to provide adequate disclosure online at a time when companies needed to communicate even more with the market in order to confront the climate of confusion [that] characterized the financial crisis.
“Overall the online communications of financial institutions gave the impression of ‘business as usual’ despite the exceptional nature of the circumstances. Companies failed to respond quickly to news online and did not seek to engage stakeholders.”
The actual numbers are alarming to communications professionals and should be equally disturbing to senior executives of all financial institutions.
- 39 companies (76%) provided at least one press release mentioning the crisis or negative events.
- 33 companies (64%) completely avoided any direct reference to the continuing financial crisis.
- 23 companies (45%) produced a Q&A addressing stakeholders’ most frequently asked questions.
- 15 companies (29%) put top management forward to offer an executive statement.
- 14 companies (27%) created Web pages specifically focusing on issues related to the crisis
- 8 companies (15%) provided links to authoritative third-party Web sites.
- 7 companies (14%) provided no crisis-related communication whatsoever on their Web sites.
- 6 companies (12%) provided crisis background information
Neither institutional size nor geographic location generated any meaningful deviation in corporate behaviors.
What to do about it
After considering the results of their research Lundquist suggests that several initial steps can be taken to improve institutional communications during such crises. They include the following actions.
- Recognize and understand the sources of communications failures; refer to the eight points above.
- Management must buy into all changes, since implementing successful online communications requires a cultural shift.
- Develop internal policies that enable faster and more effective response in times of crisis and support regular, timely and transparent information delivery. [The best corporate online communications during the crisis came from companies that already had such corporate policies. When information needed to be added to the Web site quickly the structure in place was ready to produce and manage content.]
- Thoroughly integrate online communications into the company’s strategic communications plan. [A crisis is not the time to start thinking about how best to use the Web.]
- Since determining what can be published online can be a lengthy process (especially among financial institutions), give a high priority to the people who develop Web content and ensure that they understand the company’s responses, which will allow them to propose appropriate Web content, such as special pages, videos, Q&A sections.
Recommended tactics
In order to effectively communicate online the following principles should be followed.
- Honesty – Demonstrate awareness of the situation as the first step to confidence building.
- Clarity of language – Talk to a wide audience by making information easily understandable.
- Completeness – Provide story context for corporate information being released.
- Link to other resources – Provide links to reliable third party sources of information.
- Authoritativeness – Ensure that executive management messages are delivered.
- Easy to find – Make the information users want to find highly evident.
- Coherence – Integrate the online channel with traditional media to ensure the corporate story is consistently told to all stakeholders.
- Interactivity – Evolve responses – based on stakeholder questions and concerns — using video, Q&A and dedicated contacts.
Lundquist also noted that, “Online communications is an essential and integral part of communications strategy as it is an increasingly important public face of a company and a primary source of authoritative information. As major corporations will most likely face recurring moments of negative news this channel should be strategically placed to demonstrate how the company values responsiveness and transparency. In this way trust and reputation can be regained from all company stakeholders.”
If you would like a copy of the report, please us at editor@edit30.com.
51 financial institutions surveyed
- Aegon
- Banco Popolare
- Bank of America
- Banque Populaire
- Barclays
- BBVA
- BNP Paribas
- BPM
- Bradford and Bingley
- Caisse d’Epargne
- Candian Imperial Bank of Commerce
- Citigroup
- Commerzbank
- Crédit Agricole
- Crédit Mutuel
- Crédit Suisse
- Danske Bank
- Deutsche Bank
- Dexia
- Fannie Mae
- Fortis
- Freddie Mac
- Glitnir
- Goldman Sachs
- Grupo Santander
- HBOS
- Hypo Real Estate
- ING Group
- Intesa Sanpaolo
- Kaupthing Bank
- KBC
- Landsbanki
- Lehman Brothers
- Lloyds Tsb
- Mediobanca
- Mediolanum
- Merrill Lynch
- Mitsubishi UFG
- Mizuho
- Monte dei Paschi di Siena Bank
- New York Life
- Royal Bank of Canada
- Royal Bank of Scotland
- Société Générale
- Swedbank
- UBI Banca
- UBS
- UniCredit Group
- Wachovia
- Washington Mutual
- Wells Fargo
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