J.P. Morgan Chase and the London Whale: Celebrating Scandal and Crisis.

The primary objective of PR crisis management is to address and diffuse the situation when scandal and disasters arise. You want to get people to forget the financial, moral, or criminal missteps of the corporation, executive or celebrity as soon as possible. Think Tiger Woods, Martha Stewart, or the BP disaster in the Gulf of Mexico—all created a PR crisis which needed a lot of PR spin to get out of the muck they got themselves into. When a crisis is mismanaged, the affects can be long and disastrous—hurting reputations, and livelihoods. But handled well, we quickly forget. In fact, there should be an award for good crisis management.

In fact there is.

The Investor Relations world celebrates the most successful crisis management programs of the year at an annual event that the Wall Street Journal calls “the Oscars, of sort, of the U.S. Investor Relations Industry.” Sponsored by IR Magazine, winners have included Goldman Sachs for how they handled the 2008 global financial meltdown, General Electric for its handling of the Fukushima nuclear disaster, and two-time winner J. P. Morgan Chase, who one for their efforts to cover-up spin the $6.2 Billion loss due to trading losses of what came to be known as the London Whale—their 2011 win was for their involvement with the real estate foreclosure disaster that saw throngs of Americans lose their homes to the bank.

Now, while I get that crisis management is a skill, and that shifting blame to a person (the Whale) and away from the corporation was good spin (for the company), it strikes me odd that there is a public celebration and award for skill in managing to quiet and diffuse a crisis. Doesn’t dredging up the topic simply bring it to the attention of the public once again? Isn’t it a little like an award for the “Best use of prison time after committing an armed robbery?” given to just-released inmates now looking for work? Shouldn’t we try to forget, rather than celebrate crisis?

Amazingly, J.P. Morgan Chase sent a representative to the black-tie awards ceremony to accept the award. Kathy Hu, an executive director in J.P. Morgan’s investor-relations department is quoted as saying “Can I just say, ‘Crisis? What crisis?’”

 

Chase image courtesy of Daryl Lang / Shutterstock.com



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