A near-perfect crisis plan

When a large company absorbs another large enterprise, usually, stock prices rise, investors get excited, top management rejoices and customers look for improvements across the board. But all those positives vibes can mask a big problem that can lead to a whoppingly expensive crisis.

Behind the scenes, it is common for the buyer to take over the properties of the seller. An outsider might think a lot of care might be taken to ensure the properties are safe and sound. Not so. More than we would think these adopted properties can harbor all sorts of nasty surprises. And legislation says the buyer is responsible for cleaning up the mess.

One of these cleanups went on for more than a year but, during that time, it certainly met the definition of a corporate crisis. The selling company had operated an industrial site for years and left behind a veritable lake of carcinogenic chemical. There were weekly and sometimes daily articles in the media of the town where the property was located talking about the ‘plume’ that had spread from the industrial property through the ground water lying under a large number of houses. House prices went down. The town developed a poor reputation because of the dangerous contamination. Local government was angry, confused and worried.

Luckily, the company that inherited this problem is forward-thinking with intelligent executives and an excellent outside public relations agency. When the ‘plume’ arose as a major issue shortly after the buyer took over the shut-down factory and its large property, the new owner set in motion a community relations and rehabilitation plan that included:

  • a number of information meetings explaining the problem and proposed solution
  • a community committee headed by the area Medical Officer of Health (MOH)
  • a website regularly updated run by the owner’s local (and first class) environmental consultancy
  • regularly updated newsletters
  • news releases and invitations to local media to cover the above
  • tours of the plant and site
  • surveys of the local area to identify the nature and size of the plume
  • ground water analyses
  • ground water wells
  • aeration system to decontaminate the water.

Information meetings included unbiased experts, explanatory maps and posters, addresses by the MOH and company reps who answered individual questions.

All in all, the efforts paid off at considerable expense to the company. Real estate values rose to traditional levels. The community was assured a resolution of the problem was on the way. Generally, everyone relaxed and waited for the rehab program to take effect. Today, some years later, the issue has, apparently, disappeared except for a slew of old postings on the net. If there is any complaint it is that the company did not finally close the door on the issue with a definitive ‘problem solved’ release but we guess you can’t have everything in all-but-perfectly managed crisis.