Before the Next Financial Crisis, Ensure PR Preparedness

Financial experts are no strangers to economic downturns. Fortunately, since the 2008 financial crisis which triggered the collapse of over 500 banks, tanked the stock markets and spurred years of regulatory and legislative action, we’ve come a long way. 

 Yet sometimes history repeats itself. In March of 2023, there was a familiar shiver in the room as rumblings of Silicon Valley Bank’s instability began to percolate following an investor call. Renowned as a lender to many early stage companies, venture capitalists began a whisper campaign that materialized in a run on the bank. Notwithstanding their own communications shortcomings, suddenly other banks also had important work to do to assure their own clients of the safety and stability of their own operations. 

Despite the countless “lessons learned”, one thing is clear: a crisis will happen again. When it does, there are three things your firm should know to navigate the tumult. 

Have a PR Pro on Speed Dial

Not everyone has – or can afford – an in-house public relations team, or even one on retainer. You should, however, have an internal team member or consultant who assists with your communications. When crisis strikes, these individuals can be a lifeline: steadying the ship, setting up command control and streamlining the excess work that will surely follow. Curious if your team has a trusted professional on call? It can’t hurt to check in. If they don’t, consider checking out O’Dwyers or chat with your own network for their own recommendations.  

Develop a Plan A, B and C

Contingency planning is the bread and butter of the wealth management industry. Ensure you have taken this same approach with your communications plan. Should your institution or the industry at large come under pressure, do you have a plan of attack for communicating the event to all relevant stakeholders including shareholders, depositors, employees, a board of directors and the general public? While practice makes perfect and accounting for all of the possible scenarios is a smart idea, consider drafting holding statements where you can fill in the blanks as needed. To start they can be as simple as: “We are aware that on [DATE], an [event] occurred that impacted [this population]. We are working quickly to resolve the situation and commit to providing updates as possible [in these channels].” 

Recognize that PR is an integral part of any business strategy

Remember that umbrella you keep in your closet for a rainy day? Every once in a while, you need to pull it out. When you do, you’re always glad you have it to provide some cover and shield the worst effects of the storm. Now, in the relative calm of summer, is a great time to dust off your PR strategy, or call to question why none exists. With 2024 planning approaching, consider this your sign. 

Having a clear and effective communication strategy can make all the difference when you encounter a crisis. Ensure that your board is on the same page with your plan before communicating with employees, and recognize that the larger the firm, the easier it is to muddy your message. 

When facing a financial cataclysmic event, timing is key. So, before time is of the essence, ask yourself: when the next crisis hits, are we PR prepared? 

You can also read this article on WealthManagement.com.