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On January 13, 2021, Logos President Helio Fred Garcia was quoted in an article in CEO Blog Nation about key takeaways from 2020. In the article, 20 entrepreneurs and business owners from across industries shared the tough lessons they learned during 2020. For Garcia, his 2020 takeaway was to take risks seriously.

“2020 has been a year of crisis – both because of the pandemic and the crises that have stemmed out of our response to the pandemic,” Garcia explained. “We have seen that governments, industries, and businesses that took the risks of the pandemic seriously were able to adapt quickly to mitigate those risks; those who didn’t take the risks seriously often failed to respond to the crisis in a timely and effective ways with harmful results. As we go into 2021, we need to take risks seriously and do all that we can to mitigate those risks quickly.”

Read the full article here.

The except is from an op-ed by Helio Fred Garcia published on December 2, 2020 in Modern Restaurant Magazine.

The COVID-19 pandemic, a crisis has radically reshaped the dining experience and caused a devasting impact on a once booming industry. A September survey by the National Restaurant Association found that 43 percent of full-service operators and 33 percent of limited service operations do not expect to still be in business in six months of things continue as they are. And restaurants are anticipating a total loss of $240 billion this year as a result of the pandemic.

In many ways, the ingenuity of owners and managers has enabled many restaurants to survive this prolonged crisis. As restaurants have introduced innovative solutions to continue serving their customers, such as curb-side pick-up, delivery and drive thru options, or expanded their business to grocery services, the industry has seen marginal gains since the spring. But it has not been enough.

The unfortunate reality is that it is unlikely the industry will be able to bounce back in the coming months. And the restaurant experience when we finally emerge from this pandemic will likely look much different than it did before.

So, what can restaurants at this point in this crisis?

Take Risks Seriously

The US response to COVID-19 pandemic is, in my opinion, the single worst handled crisis in our nation’s history. At the time of writing this, more than 10 million Americans have contracted COVID-19, and nearly a quarter million people have died. And this could have been avoided.

A study published in October by Columbia University’s National Center for Disaster Preparedness found that between 130,000 to 210,000 American fatalities would have been avoided if the nation had consistently applied policies equivalent to what other developed democracies had done.

A foundational principle of crisis response is to understand the scope and specifically the risks that a crisis represents, and then to do all that is necessary to mitigate those risks. The longer it takes to do that, the worse the crisis will get.

As we have seen, the federal government, in particular the current occupant of the White House, failed to take the risks of the pandemic seriously. And President Trump continues to diminish or ignore the risks of COVD-19, even as infection rates spike and more members of his administration test positive for the virus.

The changing of administrations may turn the tide of the country’s response, but we have quite some time before President-Elect Biden can enact meaningful change. In the meantime, the continued lack of a coherent federal response before the inauguration will likely to cause even more harm.

As cases surge across the country, restaurants need to take the risks of COVID-19 seriously. And that means recognizing that half measures won’t work in the long run.

While it may be tempting to continue indoor dining as we head into winter, the growing infection rate, as well as sporadic mask-wearing and social distancing policies across the country, will likely make indoor dining less safe, putting both customers and employees at risk. Restaurants need to recognize and take these risks seriously, and to be prepared to take decisive action early to protect their customers and their employees.

Foresee the Foreseeable

Many crises are not foreseeable. But months into this crisis, there are some thing we can foresee.

We are now in the third wave of the pandemic. In early November, we saw back-to-back record highs for daily cases. The likelihood, if things remain unchanged, is that we will reach a quarter million deaths by Thanksgiving.

President-Elect Joe Biden has signaled that he will take a far more aggressive approach to COVID, and has begun revealing a national strategy. In his acceptance speech, Biden declared, “We cannot repair the economy, restore our vitality, or relish life’s most precious moments… until we get this virus under control.” He continued, “I will spare no effort — or commitment — to turn this pandemic around.”

Restaurants need to be prepared for Biden to enact some form of restrictions for as long as necessary to control the virus.  That means restaurants have time to prepare what will foreseeably be one of Biden’s first acts as president.

Take the Pain

No one wants the country to shut down. There is a real and lived cost for all of us in this moment of collective crisis, one that will be felt for years to come. But one of the principles of crisis management is that sometimes we need to take the pain in the short-term in order to thrive in the long-term. This is one of those times.

Restaurants have already taken the brunt of the pain during this pandemic. And previous governmental relief for the restaurant industry has fallen short.

However, restaurants will need to be prepared to take the pain of drastically reducing their operations again, of furloughing their employees, or of shutting down for some period of time. This is a difficult decision for any business make. But it is the only way that we as a nation will make it through this crisis, and ultimately the only way the restaurant industry will be able to truly thrive again.

As restaurants will need to make difficult, but necessary, decisions to protect their customers and staff, the restaurant industry can also be proactive in fighting for relief. Since June, the National Restaurant Association, the Independent Restaurant Association, and other have been actively lobbying for expanded relief for the industry. And as the government transitions in January, the industry may find new allies to aid this cause and ensure the long-term viability of the restaurant industry going forward.

Plan for the Future

While it will likely be necessary to take the pain in the short-term, restaurants can also plan for the long-term.

In crisis management, we know that in every crisis there is opportunity. COVID-19 has changed nearly every part of our society and daily lives. As we come out of this crisis, the restaurant industry, like many others, will not look the same as it did before the pandemic. But that does not mean it cannot as good as it was before. Or that it can be even better.

The industry has already demonstrated its resiliency in the creative ways that restaurants have adapted their business models to survive during the pandemic. Should a national shut down happen, restaurants can use that time to be proactive and plan how they will rebuild after the pandemic has ended.

What will the restaurant and dining experience be after COVID-19? Restaurants can take this time to re-imagine what this experience can be like in a post-COVID-19 world, and then organize their resources to re-invent and re-invigorate both their companies and the industry as a whole.

The restaurant industry has a long road ahead to get through this crisis. But by making smart decisions in a timely way, restaurants can get through this crisis – and help us all do the same.

On November 9, 2020, Helio Fred Garcia spoke with Will Bachman on his podcast Unleashed about how leaders and organizations can understand prepare for, and respond effectively to a crisis. Unleashed explores how to thrive as an independent professional.

During their conversation, Garcia discussed the meaning of the word crisis, several key principles of effective crisis response, and ways that Logos Consulting Group works with clients to prepare for and respond to crises.

Listen to the full interview here:

This guest column by Helio Fred Garcia was released on CommPro.biz on November 2, 2020.

Here’s where the United States stands on the eve of the election: We have more than 9 million confirmed COVID-19 infections. We’re at nearly 100 thousand new cases daily; more than a thousand daily fatalities. We’re well on our way to be at a quarter million fatalities in a matter of weeks; half a million by the inauguration.

I have previously called the nation’s COVID-19 response the single-worst handled crisis, and the single largest leadership failure, in the nation’s history. Over the weekend, Dr. Anthony Fauci told The Washington Post that the nation needs to make an “abrupt change” and that we’re “in for a whole lot of hurt.”

If Donald Trump is re-elected, we can expect the situation to continue to get exponentially worse. He continues to deny the severity of the virus.

The White House science office announced this week that among Trump’s accomplishments are “ending the pandemic.” Stanford University researchers reported this week that Trump’s “superspreader” rallies in the summer through September 22 resulted in at least 30,000 infections and 700 fatalities. And that is before his own diagnosis, and his ramping up the frequency of the rallies through election day.

If Joe Biden is elected, there will still be 70 days before he takes office, and things can get much worse in that time.

We don’t have the luxury of waiting. A President-Elect Biden will need to use all the moral and political authority he can wield to get politicians and citizens to fundamentally change the way the nation is responding to the pandemic. And to recognize that all the other crises, from economic to mental health, derive from the failure to respond effectively to COVID-19.

Foundational Principle of Crisis Response: Take Risk Seriously

A foundational principle of crisis response is to understand the scope and specifically the risks that a crisis represents, and then to do all that is necessary to mitigate those risks. The longer it takes to do that, the worse the crisis will get.

Trump never took the risks seriously, at least in public. As early as February and for months after, he told Washington Post associate editor Bob Woodward what he knew about the virus:

  • It is spread in the air.
  • You catch it by breathing it.
  • Young people can get it.
  • It is far deadlier than the flu.
  • It’s easily transmissible.
  • If you’re the wrong person and it gets you, your life is pretty much over. It rips you apart.
  • It moves rapidly and viciously.
  • It is a plague.

But he was telling the nation the opposite.

The Washington Post has documented the scope and frequency of Trump’s lies while president: In his first 827 days in office, he told 10,000 lies or false statements, he told 10,000 more in the next 444 days. By July 2020, he was averaging 23 lies or false statements per day. By mid-October, it was more than 50 every day.

Last month Cornell University’s Alliance for Science published the first comprehensive study of COVID-19 misinformation in the media, and concluded that President Trump is likely the largest driver of the such misinformation.

And that misinformation had consequences. An analysis in mid-October by Columbia University’s National Center for Disaster Preparedness concluded that between 130,000 to 210,000 American fatalities would have been avoided if the nation had consistently applied policies equivalent to what other developed democracies had done. (Note that South Korea and the United States had their first cases on the same day. Our death rate is 78 times theirs.)

Columbia University, National Center for Disaster Preparedness

Advice from a Crisis Manager

I don’t have Joe Biden’s ear. But if I did here’s what I’d tell him and his team:

1. Create a true whole of government response.

We have never had a whole of government response, unlike most of our peer countries. Even at the federal level, we’ve had a fragments of government response. Different parts of the federal government had conflicting policies; political appointees micromanaged what had previously been independent agencies; there was inconsistency over time. And the states have been left to figure it out on their own.

Where Biden and his team don’t have authority (before inauguration, with states, cities, and counties), use persuasion and call for clear, consistent, and consistently-implemented policies and practices to stop the spread, treat the people, and treat the consequences of the poor response.

2.  Immediately call for full implementation of the Defense Production Act.

Call for surging the manufacturing of ventilators, medical supply, testing equipment, personal protective equipment, and sanitization technologies.

Although President Trump has invoked the act in limited ways – to require meat processing employees to work in violation of Centers for Disease Control and Prevention guidelines, and for limited amounts of masks and testing equipment, he has not surged supply.

In July, the soon-to-retire head of the Defense Production Act program at the Federal Emergency Management Agency lamented that there was no national strategy: “Why isn’t this administration using the act to prevent shortages?”

A former legal advisor to the National Security Council concluded that, “What the federal government — the president or secretaries possessing delegated authority — have not done yet is use the D.P.A. to create a permanent, sustainable, redundant, domestic supply chain for all things pandemic.”

3.  Call on all governors, mayors, and other executive branch leaders to implement a national masking, social distancing, and contact tracing policy.

Masks save lives and slow the spread of the virus. Of the 105 counties in Kansas, only 21 have mask mandates. A study last month by the University of Kansas found that counties with mask mandates saw a plateau of new cases at 20 per 100,000 people. But counties without mask mandates saw a serious spike in new cases to 40 cases per 100,000 people.

Similarly, a Vanderbilt University study last week concluded that hospitals with fewer than 25 percent of patients from counties with mask mandates had a surge in COVID-19 hospitalizations; hospitals with more than 75 percent of patients from counties with mask mandates saw essentially no change in COVID-19 hospitalizations from July to late October. 

Vanderbilt University

Finally, a University of Washington Study published in Nature Medicine says that up to half a million Americans could die of the virus in the next four months, but that up to 130,000 of them could be saved if 95 percent of Americans wear masks consistently in public.

4. Call on Congress to provide financial relief to states, businesses, families, and healthcare institutions.

The economic crisis is a direct result of mishandling the public health crisis. Now it isn’t just families and small businesses at risk, but also states, which are required to balance their budgets. States may need to cut essential services at precisely the moment when they will be most needed to keep people safe. And health care institutions are stretched thin and need assistance.

The next round of stimulus relief has been stalled because of election-year dynamics. But a clear Biden win and changes in the House and Senate could provide an opportunity to accelerate support.

5. Offer free testing

Knowledge is power. The availability of testing is still spotty and its reliability not clear. Biden should call for an army of testers, contact tracers, and managers to coordinate universal access to testing, an infrastructure to process tests quickly and reliably, and a further infrastructure to provide timely notice, notification, and referral to medical care when needed.

6. Respect science.

Restore true independence to CDC, FDA, HHS, and other public health operations of the US government. Take the advice of the science/public health experts to guide policy choices.

Public health should not be political. But the COVID-19 response has been highly-politicized. In a post-election environment, there is an opportunity to reset expectations and to get and follow the best advice of the scientists and public health experts.

It is the nature of science that it is self-correcting. When scientists are grappling with new challenges, they adapt understanding to what the evidence and data show. That should not lessen support for science, but actually increase it. Science isn’t dogma.

One of the first challenges post-election is whether, when, and how to go to a national shelter-in-place order similar to what some states did in the Spring. Britain just established a month-long lockdown. The decision on whether, when, how, and for how long to do something here should be based on the science   and on the actual risks we face, not on political calculation.

7. Assure Americans’ access to healthcare.

One week after the election the U.S. Supreme Court will hear a case in which the U.S. government and state attorneys general will ask the court to repeal the Affordable Care Act. Despite Trump’s promises for months that a plan for better healthcare will be revealed “in two weeks,” there is no evidence of such a plan. Biden and his team must act quickly to create an alternative if the Court should nullify the healthcare that so many Americans rely upon.

In the meantime, the federal government should subsidize COVID-19 prevention, treatment, and recovery for the uninsured or underinsured.

These are not political recommendations: they’re crisis management recommendations based on the severity of the risks. The tragedy is that taking the risks seriously when Trump first knew about them could have prevented all of this suffering.

Leadership courage matters.

This is an excerpt from an article posted on Medium on October 31, 2020, by Michael Toebe. In this article, Logos president, Helio Fred Garcia, is quoted sharing key insights and best practices in crisis management, and how McDonald’s can utilize these practices for greater long-term success.

McDonald’s clearly doesn’t see it yet but in its zeal to defend itself in different lawsuits filed by Black franchisees about alleged discriminatory and exploitive practices, it is talking down to and possibly gaslighting minority owners.

This reactive strategy will only serve to escalate media scrutiny, invite more investigative reporting and quite likely confirm beliefs in the Black community about alleged predatory inequality towards people of color.

A $1 billion class action suit was filed in August by 52 former franchisees. Now, another suit has been filed by two brothers, James Byrd, Jr. and Darrell Byrd.

The lawsuits have alleged that McDonalds restricted plaintiffs to stores in poor or crime-ridden areas of town, with lower sales and higher costs, which included higher security and insurance expenses, according to Reuters. Other claims by both former and current owners are of “harsher inspections and renovation requirements.”

These particular stores and opportunities were labeled by some franchisees as ‘financial suicide missions.’”

Business Insider investigated in 2019 and the findings, drawn from 2017 data from the National Black McDonald’s Owners Association, show the average company store location earned $60,000 more per month on average than those locations of Black franchisees.

McDonald’s is offended and must realize how this will look in court and more so, in the court of public opinion and has taken the surprising, if not shocking approach of communicating in a manner that is condescending of the plaintiffs, especially considering the strength of social advocacy in 2020.

“Plaintiffs offer nothing in support of this extraordinary theory beyond vague and conclusory assertions, self-serving speculation on ‘information and belief,’ and a handful of personal anecdotes,” the company has communicated.

This is, however, not unprecedented communication in scandalous conflicts.

“There are predictable patterns in crisis response,” says Helio Fred Garcia, president of Logos Consulting Group. “One such pattern of ineffective crisis response is for organizations to say and do things that feel good to them, but translate as uncaring, defensive or dishonest to those who matter, which in effect prolongs the crisis and causes self-inflicted harm.”

The behavior, arguably arrogant, is a common response before court proceedings.

“The lawsuit remains in its early stages and it is common for corporate defendants to, at least publicly, focus on the their legal arguments and defenses,” says Robert C. Bird, Professor of Business Law at the University of Connecticut and an Eversource Energy Chair in Business Ethics.

“As the lawsuit progresses, some claims may be dismissed while others may proceed onward to trial. While this happens, each side learns more about the strength of the other’s case, creating a background framework for a possible settlement between the parties,” Bird adds.

McDonald’s reactive, unrestrained and demeaning communication and posturing will be remembered negatively by the plaintiffs and critics, stoking the fires of resentment and feeding confirmation bias.

“McDonald’s voiced desire for every operator in its system to thrive while attacking a subset of its operators falls short of demonstrating the care necessary to effectively resolve this crisis,” Garcia says.

Continue reading article.

Many crises are not foreseeable, but civil unrest after the election is and leaders and organization should prepare for this.

On Monday, October 19, Logos president Helio Fred Garcia presented a pre-conference briefing on how to foresee the foreseeable and be ready for it when it happens around the US election at the Professional Speechwriters Association’s World Conference.

During this session, Garcia helped attendees understand a mindset to help leaders think through what to do and say ahead of election day, how to organize their thinking (and schedule) for various Election-Day scenarios, and how to prepare for and respond to five possible scenarios for what might happen immediately after the election.

Watch the full webinar here:

New York (June 9, 2020) – The Chinese language edition of The Agony of Decision: Mental Readiness and Leadership in a Crisis was featured in the 311th issue of Sino-Manager (经理人 in Mandarin Chinese) magazine, a leading business publication in China.

This book is about how leaders and the organizations they lead can maintain reputation, trust, confidence, financial and operational strength, and competitive advantage in a crisis.

“This book is written by an expert with more than 30 years of crisis management experience,” wrote the Sino-Manager editor about the book. “It’s recommended for all government and non-government organizations, higher institutions, business managers, and public relations professionals.”

Helio Fred Garcia, the author, presents the lessons from this book to a multitude of audiences, ranging from one-on-one sessions, seminars, and interviews.

“It’s an honor to be recognized by one of the major business publications in China,” said Helio Fred Garcia, the author of the book and the president of Logos Consulting Group, “I hope it will help leaders in China navigate through difficult times.”

Sino-Manager is an elite business magazine intended to provide C-suite executives and senior managers with the latest business news and management solutions. Launched in 1989, the magazine is available both online and in a physical journal. The Agony of Decision was featured in the “CEO Bookcase” section, a monthly reading recommendation list.

-END-

For media INQUIRIES please reach out to Maida K. Zheng, mzheng@logosconsulting.net or at 315-368-4287.

 

About The Author

Helio Fred Garcia, known as the Global Crisis Advisor, has helped leaders build trust, inspire loyalty, and lead effectively for more than 40 years. He is a coach, counselor, teacher, writer, and speaker whose clients have included more than 400 CEOs of some of the largest and best-known companies and organizations in the world, in dozens of countries on six continents.

NEW YORK (May 13, 2020) — As the nation begins implementing plans to reopen, Logos Consulting Group will continue practicing social distancing while also providing the personal touch our clients expect.

“Connecting closely with clients is and always will be our highest priority, in whatever form that takes,” said Helio Fred Garcia, president of Logos Consulting Group. “These are some of the hardest times for many leaders and organizations, which is why it is more important than ever before for us to be available.”

Logos Consulting Group helps leaders and their organizations manage choices when stakes are high, communicate effectively when trust is on the line, and strengthen leadership skills to inspire action.

“We have been advising institutions and their leaders directly in the midst of COVID-19,” added Garcia. “Right now, we’re providing immediate counsel to clients in both our crisis management and crisis communication practice, as well as virtual coaching for multiple leadership levels and designated spokespeople.”

Logos Consulting Group has also been studying trends on leadership in COVID-19 and has written and spoken extensively about these findings. Logos associates have spoken publicly at a variety of webinars, virtual conferences, and coaching sessions including the Defense Innovation Network, Public Relations Society of America, Professional Speechwriters Association/Executive Communication Council, and others to include events for our clients. Topics have included best practices in communication during COVID-19, maintaining powerful presence in a remote environment, effective social media messaging, and more.

“This is not the end of the crisis, it is the end of the beginning,” said Garcia. “We are not slowing down, and if anything, we are making ourselves more available than ever before by guiding our clients through this crisis.”

To explore how Logos Consulting Group can help you, contact us via email here or via our website here.

 

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Crises reveal what organizations value. Whether a business demonstrates corporate responsibility during the COVID-19 pandemic, or fails to do so, can determine if the company and its leaders emerge from this crisis with the trust and confidence of their stakeholders intact.

Source: google.com/covid19/

Definitions of corporate responsibility have evolved from an exclusive focus on shareholder returns, to the acknowledgment by businesses of a much broader group of corporate stakeholders and range of responsibilities. Acting responsibly today means more than legal compliance and goes beyond corporate philanthropy.

At its core, corporate responsibility means meeting stakeholder expectations for responsible conduct. Meeting both the financial and non-financial expectations of its investors, customers, employees, business partners, suppliers, regulators, and the communities where it operates, helps a company to manage risk, protect its reputation, attract and retain employees, grow its markets, and sustain its financial performance.

Demonstrating corporate responsibility is a key challenge for business leaders in the best of times. As my colleague Helio Fred Garcia observes, the COVID-19 crisis comprises simultaneous crises (public health, business, economic, information, governance, social, mental health) of unprecedented scope that require a multi-dimensional leadership response. [1]

Unprecedented in its scope, the COVID-19 pandemic is an opportunity for companies and their leaders to live their values by acting responsibly.

When navigating next steps during the pandemic, business leaders should keep in mind key principles for demonstrating corporate responsibility.

 

Understand the potential impacts of your crisis response.

Responsible organizations understand the potential impacts of their actions and take steps to “do no harm.” Business leaders determining how to respond to the pandemic need to assess the potential impacts on all company stakeholders.

Well-managed organizations plan for foreseeable crises. Companies that engage in meaningful crisis planning likely had a standby pandemic crisis plan they could draw upon as they began to address COVID-19. Effective crisis management plans identify potentially affected stakeholders and catalogue relevant corporate policies for high priority scenarios. A global manufacturer’s pandemic planning, for example, would have considered the business impact of supply chain interruptions, triggers to suspend executive travel, and criteria for allowing employees to work remotely.

When evaluating next steps, companies should seek to “do no harm” by preventing or mitigating harmful impacts.

Companies without a pandemic crisis plan in place can still identify potential impacts to guide their response. Enterprise-wide impact mapping and assessment can help an organization prioritize next steps. By applying a human rights impact lens to its operations and stakeholders, [2] a hospital system, for example, might prioritize securing adequate personal protective equipment to ensure the health and safety of its healthcare workers; expanding diagnostic testing among vulnerable communities to ensure nondiscrimination in patient access to healthcare, and communicating information about the virus and medical capacity to ensure public access to reliable and timely information.

When evaluating next steps, companies should seek to “do no harm” by preventing or mitigating harmful impacts. Apparel companies that have cancelled supplier contracts for goods during the pandemic face criticism for triggering layoffs of the factory workers worldwide that make their products, often among the groups most vulnerable to COVID-19. A quick stakeholder impact assessment would have flagged the risk of harming supply chain workers. Responsible international brands have sought to protect workers by honoring their supplier contracts during the pandemic.

Similarly, companies that provide paid sick leave are protecting the health of employees, customers and the general public alike. When the California-based retailer Patagonia voluntarily closed its stores nationwide while continuing to pay its employees, its CEO and President, Rose Marcario stated, “It’s everyone’s responsibility to help stop the spread of this virus.”

“It’s everyone’s responsibility to help stop the spread of this virus.” 

− Rose Marcario, CEO and President, Patagonia Inc.

 

Anticipate changing stakeholder expectations.

Meeting stakeholder expectations demonstrates corporate responsibility and earns the trust of those who matter most to your business. All stakeholders expect a responsible organization to care about the multiple dimensions of the COVID-19 crisis and to take appropriate action.

What stakeholders expect a responsible company to do will change. The current pandemic is a dynamic situation that calls for decision-makers to adapt policies to new information. Responsible companies meet stakeholders where they are and adjust accordingly.

Customers, for example, expect essential businesses that remain open (or that reopen) to follow public health guidelines, to protect their employees, and to protect vulnerable community members. Obeying the law is the just the starting point.

On my first trip to the grocery store after a statewide “stay-at-home” order had been issued, the store had placed limits on the number of scarce items that customers could buy, like cleaning products and milk. Employees were working hard to keep shelves stocked. Two weeks later, consistent with evolving public health guidance, the store was limiting the number of customers allowed inside at once, plexiglass shields had been placed between checkout workers and customer payment stations, and all store employees wore gloves and masks. The grocery chain had also adopted an industry-wide practice reserving its opening hour for elderly customers. On my most recent shopping trip, the store had instituted “one-way” aisles to ensure physical distancing and all customers were required to wear face coverings.

Some of these measures were mandated; some were voluntary. All track what the store’s customers, employees, and community would expect a responsible grocery store to do under the circumstances based on available information.

Conversely, companies that act contrary to stakeholder expectations for responsible conduct, even if the actions are legal and contribute to the bottom line, risk losing the trust of customers, investors, and regulators. Large public corporations that secured millions of dollars of loans under the Paycheck Protection Program intended for small businesses, for example, have endured substantial public criticism prompting some companies to return the funds. The angry reaction should not have been a surprise for corporate leaders paying attention to stakeholder expectations. 

 

Philanthropy is not a substitute for responsibility.

Stakeholders expect responsible companies with the resources to do so, to give money and to tap their expertise during a crisis. Many businesses, large and small, have responded to the pandemic by providing financial or in-kind support to healthcare workers, to small businesses, and to international and community organizations addressing the impacts of COVID-19 on vulnerable populations.

Source: covid19responsefund.org/

Google has pledged more than $800 million to support small businesses, health organizations and governments, and health workers on the frontline of the global pandemic. The company’s contribution includes $250 million in advertising credits to help the World Health Organization and more than 100 government agencies disseminate information on how to prevent the spread of COVID-19. Citigroup is donating a total of $15 million to the United Nations Foundation and World Health Organization’s COVID-19 Solidarity Response Fund, to No Kid Hungry to support emergency food-distribution programs in the United States, and to international efforts in countries that are severely affected by the pandemic. The British and Dutch consumer goods multinational Unilever is contributing €100 million through donations of soap, sanitizer, bleach and food, including adapting its manufacturing lines to produce sanitizer for use in hospitals.

All of these efforts are welcome.

Philanthropy, however, does not excuse a company from acting responsibly elsewhere in its operations.

Source: www.ethicalconsumer.org

Amazon faces intense criticism for failing to adequately protect its employees from the outset of the pandemic; resisting paid sick time, hazard pay, and health benefits for part-time employees; and retaliating against a warehouse worker who protested working conditions. Since then, Amazon has enhanced its health and safety practices, hired 175,000 additional employees, and donated thousands of laptops to Seattle public school students, among other efforts. CEO and Founder Jeff Bezos announced a $100 million gift to Feeding America. The company’s philanthropic responses alone, however, are proving insufficient to meet stakeholder expectations for responsible conduct. Employees continue to protest Amazon’s working conditions and policies, and regulators have launched investigations into the company’s labor practices.

McDonald’s Corporation has donated over $3 million in food to support local communities during the COVID-19 pandemic; yet, more than half a million McDonald’s workers without access to paid sick leave are serving food nationwide.

Leading companies act and give responsibly.

 

Business leaders are called to act when government fails to do so.

The COVID-19 pandemic has triggered a crisis of government capacity and leadership. Corporate responsibility today means filling these governance gaps.

Business leaders should be prepared to address the governmental pandemic response by speaking out against harmful policies and advocating for responsible solutions.

Source: coronavirus.jhu.edu/map.html, visited 5/8/2020

Responsible companies in the United States are meeting public needs that the federal government has failed to address. Companies in many different sectors are stepping in to manufacture, purchase, and distribute personal protective equipment; to accelerate production of diagnostic tests and medical equipment like ventilators; and to disseminate accurate data on the virus and its spread. Microsoft voluntarily told its employees to work from home in support of local health authorities’ efforts to communicate the urgency of the looming pandemic in Seattle. Apple and Google are partnering to develop contact tracing technology to help governments and health agencies reduce the spread of the virus.

Stakeholders increasingly expect corporate leaders to speak out on public policy issues, [3] such as gun violence and immigration policy, [4] when government fails to act or causes harm. COVID-19 is accelerating this trend. In his annual letter to CEOs, Larry Fink, the chairman and CEO of BlackRock, the world’s largest asset manager, noted last year that “stakeholders are pushing companies to wade into sensitive social and political issues — especially as they see governments failing to do so effectively.” Fink called on CEOs to demonstrate leadership and corporate commitment to “to the countries, regions, and communities where they operate, particularly on issues central to the world’s future prosperity.” No issue meets these criteria right now more than the multi-dimensional COVID-19 crisis.

CEOs that understand and anticipate the potential impacts on of all of their company’s stakeholders are not rushing to reopen.

Business leaders should be prepared to address the governmental pandemic response by speaking out against harmful policies and advocating for responsible solutions. Consumer product brands have had to correct inaccurate information about disinfectants. Many businesses in the United States must now decide whether to reopen against data-driven public health guidance. CEOs that understand and anticipate the potential impacts on of all of their company’s stakeholders are not rushing to reopen.

Unprecedented in its scope, the COVID-19 pandemic presents a unique opportunity for companies and their leaders to live their values by acting responsibly.

 

Logos Senior Advisor Anthony Ewing counsels executives on corporate responsibility and works with clients to establish and strengthen crisis management programs. He teaches a graduate seminar on corporate responsibility at Columbia Law School.

 

Notes

[1] Helio Fred Garcia, “Leadership, Communication, and COVID-19,” (Mar. 25, 2020) https://logosconsulting.net/leadership-communication-and-covid-19/.

[2] Anthony Ewing, “Integrating Human Rights into Crisis Planning,” A Good Practice Note endorsed by the United Nations Global Compact Human Rights and Labour Working Group (6 October 2015), https://www.unglobalcompact.org/docs/issues_doc/human_rights/Human_Rights_Working_Group/crisis-planning-GPN.pdf.

[3] Aaron K. Chatterji and Michael W. Toffel, “The New CEO Activists,” Harvard Business Review (January–February 2018), https://hbr.org/2018/01/the-new-ceo-activists.

[4] Anthony Ewing, “Business and Human Rights: Lessons for Managing the Trump Presidency,” blog post, February 13, 2017, https://logosconsulting.net/business-and-human-rights-lessons-for-managing-the-trump-presidency/.

New York, NY (April 23, 2020) – The Chinese-language edition of The Agony of Decision: Mental Readiness and Leadership in a Crisis by Helio Fred Garcia, was named one of the “Eight Must-Read Books in the Next Ten Years” by Notesman. The announcement came on World Reading Day in China.

“I’m honored to see The Agony of Decision Chinese edition is featured in that list and to know that the book is helping leaders and organizations in China navigate through difficult times,” Garcia noted.

Notesman (or 笔记侠 in Madarin Chinese) is one of the most-followed Wechat official accounts that share business insights.

“I hope this book can help you learn to make precise judgements and smart decisions in a crisis, and to take effective actions when the time is right, turning any danger to an opportunity,” said the editor of Notesman.

You can learn more about the English edition of Agony of Decision here. The Chinese edition is available as a physical book, an e-book, and an audio book at all major Chinese online markets, including Dangdang, JD, Taobao (Alibaba), and Amazon China.

For media inquiries, please reach out to Maida K. Zheng, mzheng@logosconsulting.net or at 646-338-0422.