1. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Navigating a Corporate Crisis Pre-Crisis Phase September 20, 2012 Presented by Dori K. Stibolt

2. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Does your company have a crisis management plan?

3. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Is this your current crisis management plan?

4. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Why do you need a crisis management plan?  Crises are unpredictable, but should not be unexpected  Since crisis events are generally a surprise, planning is vital because you likely will have a short response time  Protect reputation, market share, competitive edge, investor confidence and the long term health of the org.

5. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Why do you need a crisis management plan?  In times of great stress, people revert back to what they know and how they have been trained to respond  As such, if you want your people and your organization to respond well to a crisis, your employees need a plan, leadership, and a level of knowledge and training to respond appropriately  Preparation can be the difference between success and failure

6. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Role of In-House Counsel  Educate, educate, and then educate some more - Counsel must educate management and the board of directors that no business is immune from a crisis - Lobby management to implement and commit resources ($$$) to a crisis management plan

7. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Role of In-House Counsel  Preparation of a crisis management plan is going to involve costs  Provide cost-benefit analysis to upper management  When undertaking your risk audit, think about how many days (or weeks) your company might be unable to operate per each potential crisis

8. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Role of In-House Counsel  Think about and estimate lost business per day/per site  Analyze potential losses related to: - Business opportunities - Reduction in market share - Customer confidence - Brand/reputation impact

9. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Role of In-House Counsel  Prepare Crisis Management Plan. - Strategize regarding the kinds of crisis that may impact your company - Undertake a risk audit - Develop a crisis management team - Develop an agreed upon crisis response philosophy with senior management

10. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  Product recall or product safety issues

11. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  Federal or State investigation or enforcement action

12. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  Attacks by consumer advocacy groups

13. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  Serious injuries involving your product or service

14. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  Major infrastructure failure/supply chain disruption

15. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  Executives or officers are indicted or arrested

16. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  Natural disaster or fires

17. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Potential Corporate Crisis  A whistleblower employee

18. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Risk Audit  What could disrupt our business?  Short Term disruptions  Long Term disruptions  Look to your comparators  Review and analyze past crises  Identify your vulnerabilities

19. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Risk Audit  Financial  Strategic  Operational  Compliance  Reputational

20. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Crisis Management Team  Who should be on the team?  A well thought out team should include: - Management - Legal - Operations - IT - Public relations - Human resources - Business units

21. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP The greatest crisis management plan  This is called the nuclear football, it is part of our country’s Mobile Emergency Command Center  The President of the United States utilizes this when he is away from a fixed command center.

22. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Components of a crisis management plan: - Executive summary - Crisis Management policy - Types of events covered by the plan - Response plan - Crisis communication plan

23. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Crisis management team should have good understanding of all aspects of the company and business  Depending on team configuration, each team member may report on their area of the business or prepare a fact sheet  Utilize discoveries from the risk audit to determine probable scenarios to prepare for

24. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Brainstorm and role play  Assign other team members as a Devil’s Advocate committee  Contemplate and address the worst case scenarios  Prioritize

25. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Design is important - Easy to read type - Understandable sub headings - Index - Flow Charts - Lists  Contemplate having a first hour check list

26. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Include and maintain information on major projects in-progress  Assign team members’ responsibilities  Detailed contact information for team members and other important individuals (outside counsel, insurance, utility companies for a site

27. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Incorporate your company’s vision and ethical standards into your plan  Develop and prepare your response to the crises that you have identified: - A product recall - An injury due to your product/service - A visit by law enforcement - A weather event

28. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Develop crisis communication plan - You will need an internal crisis communication team - Assign a person to communicate internally to employees - Make sure to have a back up person - Communicate accurate information to employees in a timely manner

29. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Develop crisis communication plan - Take charge of communication quickly but cautiously - Consider making a preliminary statement - Understand the facts and the situation before making a more detailed statement - Understand the dynamic between admissions and future litigation - Be aware of and monitoring social media - Be prepared to address any past issue

30. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Develop crisis communication plan - Understand who will likely be your audience in a crisis situation  Employees  News media  Site neighbors  Community Leaders  Elected official  Customers  Stockholders and financial coummunity

31. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Develop crisis communication plan - Communications during a crisis should be calm, organized and factual - Establish a predetermined communication center (and a back-up) - Establish telephone answering procedures for directing media and emergency inquiries to the appropriate people - Establish an internal system for communicating with employees

32. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Develop crisis communication plan - Develop positive messages for your crisis response  Safety record  Family owned  Community and charitable giving - Be certain employees know who the authorized spoke person is and they further should be trained to not respond to media

33. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Develop crisis communication plan - Act FAST – the media will mobilize quickly - Make the media aware that you want to be helpful and cooperative - But, do not speculate - Maintain contact information for media - Schedule additional updates both for the media and employees

34. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Develop crisis communication plan - Be aware and appropriate if crisis has caused death, injury, environmental damage - Providing some media statement is better than not talking - Do not provide “off the record” or “no comment” statement - Do tell the truth - Continue to be accessible and responsive

35. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Prepare Your Plan  Integrate your crisis management plan into your company policies and procedures  Train your employees  Practice for an emergency  Update your plan on a regular basis  Hold crisis management team meetings

36. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Now What??

37. Navigating a Corporate Crisis © 2012 Fox Rothschild LLP Contact Information Dori K. Stibolt DStibolt@foxrothschild.com 561.804.4417