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Managing through a crisis is a part of life for public company boards and management, so it is now more important than ever to consider the approaches that companies are taking to their crisis management efforts. In the 2023 Global Crisis Management Benchmarking Report, Morrison Foerster and Ethisphere surveyed senior executives in ethics, legal, compliance, public relations, communications, and risk functions in early 2023 about a wide range of crisis management topics. Key takeaways highlighted in the report include:

– The crisis landscape is evolving. In our survey, respondents identified cyber breaches, workplace violence or harassment, and environmental damage as the three most common risks likely to cause a crisis. Alongside these risks, organizations also identified emerging geopolitical issues, including regulatory responses pertaining to Russia and China.

– Crisis management planning and processes should be a collaborative effort. The survey reaffirmed a key pillar to crisis response: the way companies respond to crises is vital, and the effectiveness of response depends on creating and implementing proper crisis management processes and procedures. Crisis response should incorporate a cross-functional group of professionals who can support corporate leadership, including functions such as operations and technology, legal, human resources, media relations, risk and compliance, finance, and investor relations. Organizations should also have a bench of outside experts, from law firms to crisis communications firms, who can help them see around corners.

– Crisis response drills are an effective way to prepare an organization for a crisis. Seventy-nine percent of survey respondents indicate they conduct crisis response drills on key risks areas, with 95% stating that they conduct drills annually or more frequently. These drills often include senior executives, and sometimes board members, in addition to middle managers.

– Organizations are becoming more proactive in how they respond to crises. Survey respondents cite multiple changes they have made to their crisis management response since the start of the pandemic, including the increased use of technology (64%), preparedness (48%), involvement from leadership (48%), and the frequency with which they conduct drills (20%).

Not surprisingly, companies identified cybersecurity incidents as the top crisis risk facing companies today (60%), with macroeconomic conditions and health and safety risks tied second (28%).

One encouraging trend to note from the report is that the confidence in the ability of organizations to manage a crisis has significantly improved. In 2018, 39% of respondents stated that they were very confident in their organization’s ability to manage a potential crisis, while in 2023, that number increased to 64%.

– Dave Lynn