Thursday, June 09, 2005
The Price of Secrecy
What does secrecy cost? How about a billion dollars in round numbers? That's the price that the Catholic Church in the US has paid so far for covering up child abuse. The point here is not to bash religion but to highlight what poor PR decisions can cost. A billion dollars is more than the Catholic Church can afford. Dioceses throughout the US have been selling assets to make settlements, and they won't get the assets back.
It's no different with public companies, or any other organization. Keep secrets about misdeeds, and it will catch up to the organization some day. It is ALWAYS better to get these things out of the way as soon as possible.
Several companies, like Boeing, recently did the right thing. They caught CEOs engaged in improper activity. They fired the CEOs on the spot and others who knew or should have known. Companies are doing that more often now, primarily because they are afraid of prosecution and of lawsuits, but it is better PR. Cover-ups have never been smart, but now they are not only dumb decisions, they're expensive.
It's no different with public companies, or any other organization. Keep secrets about misdeeds, and it will catch up to the organization some day. It is ALWAYS better to get these things out of the way as soon as possible.
Several companies, like Boeing, recently did the right thing. They caught CEOs engaged in improper activity. They fired the CEOs on the spot and others who knew or should have known. Companies are doing that more often now, primarily because they are afraid of prosecution and of lawsuits, but it is better PR. Cover-ups have never been smart, but now they are not only dumb decisions, they're expensive.
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