Crisis in Corporate Reputation: The Big Issues of 2023

December 4, 2023

By Esme Arendse, Aprio Credence CEO

The year has proven to be a tough one for several well-known global corporations that have faced significant reputation crises. From data breaches to unethical behaviour, affected companies have had to navigate the fallout from these incidents, often facing public backlash and a loss of stakeholder trust. In almost all of the examples that follow, we believe companies would have benefitted from being more prepared, including being armed with carefully considered and research-based playbooks, skills and protocols for handling major reputation risks.

Here are some of the main corporate reputation crises of 2023.

1. Global Tech Giant’s Data Breach

One of the biggest corporate reputation crises of the year was the data breach at a global tech giant. The breach compromised the personal information of millions of users, leading to concerns about privacy and security. The company faced harsh criticism for failing to adequately protect its users’ data and for being slow to address the issue. The incident raised questions about the company’s commitment to user privacy and cybersecurity and took a significant toll on its reputation.

2. South African Big Four Bank Fallout with Climate Change Activists

A major South African bank was in the spotlight this year for its suboptimal handling of climate change activists. The company forcibly removed activists and journalists from its building, drawing widespread criticism for its heavy-handed approach. The incident raised concerns about the company’s commitment to environmental sustainability and clearly demonstrated that it needs to develop protocols and playbooks to manage reputation risks of this nature.

3. Another South African financial institution was implicated in the Al Jazeera gold smuggling/money laundering investigative journalism exposé. Their financial results were delayed, staff were fired, and rumours abound that it has had massive financial impacts, among other issues.

4. Several leading independent schools found themselves in the media spotlight for allegedly failing in their duty of care to their students, with several instances of alleged sexual predators operating within the school system.

5. Fast Fashion Retailer’s Unethical Labour Practices

A major fast fashion retailer found itself in hot water after it was revealed that the company had been exploiting workers in its supply chain. Reports emerged of poor working conditions, low wages, and abusive labour practices in the factories that produced the company’s clothing. The retailer faced widespread condemnation for its unethical behaviour, with many consumers calling for a boycott of the brand. The incident damaged the company’s reputation and raised concerns about the broader issue of worker exploitation in the fast fashion industry.

6. Social Media Platform’s Mismanagement of Disinformation

A popular social media platform came under fire for its mismanagement of disinformation and hate speech on its platform. The company had been slow to address the spread of harmful content, leading to concerns about the platform’s impact on society. The company faced significant public backlash and calls for greater accountability and regulation. The incident damaged the platform’s reputation and raised questions about its ability to effectively police its content.

In conclusion, the main corporate reputation crises of 2023 have highlighted the importance of ethical behaviour, transparency, and accountability in the business world. Moreover, this year has again highlighted the need for boards of directors and executive teams to invest time and resources in reputation resilience.

If you would like to enhance your reputation resilience protocols, please contact Esme Arendse at Aprio Credence on esme@aprio.co.za or call her on 082 694 7643.