Thomas Cook have found themselves in a furore over the death of two children at a hotel in Corfu. Their real sin – in the eyes of the parents and the tabloid press – seems to have been that they did not express much contrition at the time and have steadfastly refused to apologise since then. The fact that they received a substantial pay-out from the hotel to cover damage to their reputation and PR expenses has, quite understandably, just added to fuel to the fire.
At the time of the incident in Corfu, Thomas Cook was in the hands of an arrogant and incompetent management who were running the company into near bankruptcy and awarding themselves ever-increasing salaries and bonuses. Their poor behaviour in this case was simply part of an overall malaise in the company. These people departed a long time ago and the person brought in to bring the group back into shape has also left which, if judged by the stockmarket’s reaction, was a very positive move. The company is now, finally, in more sensible hands but the new management will really have their work cut out to rescue this particular situation.
The standard PR advice when a company is involved in an event where people are killed or injured is that the CEO should make a full and frank statement of contrition. CEO’s are human too; they have wives and children and have not set out to hurt their customers. In many cases, they will be genuinely shocked and upset at what has happened.
However, despite the PR advice, they will be firmly told by their company lawyers that they must not say anything that could be seen as accepting even a tiny bit of liability. The company’s insurers will probably back this up with a threat to suspend cover if the CEO says anything remotely prejudicial to a possible legal case.
In many instances, a CEO is tied. He knows what he should say – and probably want to say – but cannot.
I was actually rather shocked at the reaction of the CEO of Lufthansa to the Germanwings crash. Within days of the accident, and well before even a preliminary report had been prepared by official investigators, he appeared to be accepting some of the blame. In one way, his reaction was spot-on – it was quite clearly honest and heart-felt. He was as shocked and upset as anyone. The company’s sensitive behaviour was almost a text book example of how to behave in such an event. But had he cleared his comments with his insurers or did he just feel it was worth the risk?
Thomas Cook will have to pay for the sins of their previous management but properly-managed, honest companies have a huge problem balancing the opposing demands of their PR advisers and their insurers.