By Anja van den Berg
Having your employer get caught in a public scandal is a tormenting professional experience. Even if your company pulls through as fiscally sound, it more than likely will have to deal with a tarnished reputation.
“When your company makes headlines for all the wrong reasons, you’re put in an extremely difficult position,” says Dorie Clark, a marketing strategist and the author of Entrepreneurial You. “All of a sudden, the place you associate with your work, your colleagues, and your projects, is overridden in the public imagination. It becomes a caricature.”
Companies that are tainted by scandal often suffer from stigma the same way individuals do, says Eric Lin, an assistant professor in the Department of Behavioural Sciences and Leadership. Lin and his research team, professor of Business Administration George Serafeim and research associate Robin Abrahams, published a research paper on The Scandal Effect.
In the report, the team notes that other organisations may sever relationships with a company tainted by scandal or try to take financial advantage of the situation. Stigmatised companies may be mocked in the media, have their charitable donations rejected, see employee morale plunge, and experience an exodus of talent.
Moreover, organisational stigma is contagious, not only for employees, but sometimes even for other companies in the same industry that have done no wrong.
As you contemplate whether to remain or look for other opportunities, there are measures you can take to safeguard your reputation and your sanity. Here are some things to consider:
- Don’t self-flagellate
First things first: don’t beat yourself up. Working for a company that’s caught up in an ugly public scandal is stressful, exhausting, and shame-inducing. “You feel besieged,” says Clark. And you often feel guilty by association. Indeed, studies show that the impact of a scandal on employees is far more significant than anyone would have ever thought. Pay special attention to your emotional needs during this time; being stigmatised can have serious consequences on your psychological health.
- Understand the context
Next, understand whether the negative publicity your company is getting is a problem you can move past or a severe blow that will last for years, says Clark. Your objective is to grasp the extent of the scandal. While it’s impossible to have perfect clarity, it’s important to have perspective. “Unless staying somehow condones the scandalous behaviour, you shouldn’t feel the need to rush out the door,” she advises. “A lot depends on the specifics of the scandal and where you sit within the organisation.” If the problem was an isolated incident due to a specific colleague, and actions have been taken to correct misdeeds, the scandal could die down soon.
- Take a stand (if necessary)
There’s often no need to leave quickly, but occasionally the situation warrants it. “There could be some scandals that are too inconsistent with your values or are too massive in scale that you feel the need to get out,” says Amy Edmondson, a professor at Harvard Business School.
Also, if your company’s scandal involves a continuing drip of revelations, where it becomes apparent that the problem was widespread and many were complicit, it probably makes sense to start looking for other career opportunities. “If you’re a member of the leadership team, then you vote with your feet,” Clark adds.
The tactics for surviving an organisational scandal depend on multiple factors: what phase of your career you’re in, your skill set, the industry, the overall labour economy and how willing you are to make changes. But the basic strategy is the same: get the facts on the table, assess the context, and – if it is the best decision for your career – find a position that will allow you to prove yourself again. The scandal effect can’t always be predicted or controlled, but it can be survived.
Harvard Business Review: https://hbr.org/2016/09/the-scandal-effect
Harvard Business Review: https://hbr.org/2016/08/how-to-survive-a-company-scandal-you-had-nothing-to-do-with
Harvard Business Review: https://hbr.org/2018/12/if-your-company-is-going-through-a-public-scandal-should-you-leave