New research shows a decline in crisis readiness by organisations across Australia and New Zealand, enhancing reputational risk.
The 2020 Reputation Reality Report – compiled by SenateSHJ and Governance Institute of Australia – surveyed 278 senior executives across Australia and New Zealand.
According to the report, there is a trend in both countries for organisations to be less crisis ready than in previous years. Business continuity plans are more widely used than crisis communication plans, SenateSHJ noted, however both tools are in decline compared to 2019.
In Australia, 8 per cent of organisations are testing their crisis plans less than once a year, 18 per cent are doing so annually, and just 7 per cent are testing once every six months.
There is also a decrease in use of crisis communication plans and business continuity plans, with Australian organisations using said plans 14 per cent less and 3 per cent less respectively than in 2019.
For those with crisis communication plans in place more broadly, fewer organisations are testing them on an annual basis, SenateSHJ said, and only 15 per cent of Australian organisations and 19 per cent of New Zealand organisations feel “very confident” in their ability to carry out their plans in a crisis.
“This is a significant decline from 2019, when 27 per cent of New Zealand organisations and 22 per cent of Australian organisations were ‘very confident’ in their ability to carry out their plans,” the report said.
“This decline in Australia is in part because of the decrease in the number of organisations that have crisis communication plans at all, which is even more concerning.”
“How an organisation responds is just as important as what it says, and failing to prepare properly greatly enhances reputational risk,” SenateSHJ surmised.
The same report found that integrity, relationships and quality of products and services are the three most important drivers of reputation for an organisation.