by John Suttle
When PwC partner, Brian Cullinan, handed Warren Beatty the envelope for best actress instead of best picture at this year’s Academy Awards, he caused immediate, incalculable reputational damage to the company. With his CEO, Tim Ryan, sitting in the audience and millions of people around the world watching, he single-handedly torpedoed PwC’s reputation for accuracy and integrity it had built over 83 years as the “Academy’s Accountant.” As one of the “Big Four” accounting firms, PwC had a sterling reputation and in the interest of full disclosure, I have been a client of theirs and have friends and acquaintances in the company.
It remains to be seen whether the company can withstand the hit to its credibility, but so far, they have done everything right when it comes to crisis communication. Mr. Ryan has accepted responsibility for the incident, apologized and pledged to conduct a full investigation to identify the cause. He made himself immediately available to media and did not hide behind a wall of lawyers. His message was simple: We did it. We’ll figure out why it happened and we’ll make sure it never happens again. At the end of the day that's all people want to hear. They want you to own it and fix it. Not accepting responsibility and providing non-answers to reporters’ questions only makes the public distrustful of you and your company and keeps the story alive when you want it dead as soon as possible (BP’s Deepwater Horizon disaster is the poster child for this).
We'll see how much bounce the story will get if the investigation reveals, as has been reported, that Mr. Cullinan made the error because he was distracted backstage tweeting photos of Emma Stone. If that is true, he should exit stage left and not wait for the hook.