Australia CA Leaders: Corporate Reputation and Cyber Security are Key in 2024

Managing reputational risk is top of the agenda for Corporate Affairs (CA) leaders across APAC, with the issue receiving the number one ranking in the Andrews Partnership’s 2024 Corporate Affairs Leaders study. In Australia, a range of established and emerging trends — coupled with an increasing number of large-scale cyber-attacks — have made it an area of unique focus. 

We recently held two roundtable discussions in Sydney to deep-dive into corporate reputation and managing cyber crises. Attendees including Rory Macpherson of advisory firm Brunswick Group, Jane Anderson, Executive General Manager Community, Sustainability & Stakeholder Engagement, Australia Post and Felicity Ross, Chief Corporate Affairs Officer at broadband network NBN, shared their insights into why corporate reputation is in the spotlight in Australia and tactics to navigate an increasingly multifaceted landscape.

What’s impacting corporate reputation in Australia?
It seems that not a week goes by without a company appearing in the headlines for the wrong reasons, whether related to workplace misconduct, environmental accidents, stakeholder activism or — an area of growing focus — cyber security breaches. 

So what are the trends affecting corporate reputation in Australia and what do they mean for today’s CA leaders? 

Concentration of industry
Australian industries are on average more concentrated than their counterparts in the US, according to a study from economic research group e61. Between 2006 and 2020, concentration increased by 3% with experts predicting this trend to continue. Why does this matter to reputation? Due to a relative lack of competition, brands have more touch points with the Australian population and more opportunities to bolster — or undermine — their reputation.

Politicisation of issues
As business issues become politicised, crises in Australia can potentially have a longer tail than in other countries. This is largely due to regulatory investigations and Australian Senate Inquiries into areas ranging from supermarket prices to greenwashing that keep topics in the headlines.  

Connecting pay to executive responsibility
An increased focus on Board and Chair accountability for corporate reputation means senior leaders could now find that a dent in their company’s reputation impacts their reward package. Writing in the Financial Review under the headline ‘A hot tip for CEOs — reputation counts for everything,’ Jenny Wiggins points out that some Australian corporates link 20-30% of executive long-term bonuses to reputational metrics. If what’s measured is what matters, more CEOs will be turning to their CA leaders to safeguard corporate reputation as a top priority. 

The rise of investor activism
Data compiled by Bloomberg Intelligence found that 2024 is already the biggest year on record for investor activism in Australia. The volume of campaigns initiated on issues related to climate change, Indigenous engagement and other ESG areas already stands at 27, more than double the average for the same period over the last decade. CA leaders find themselves under pressure to advise Boards and clearly articulate their stance in the face of a growing number of campaigns. 

Regulatory rigour
In addition to consumers, government and the media, CA leaders must also engage with regulators as they look to protect corporate reputations The increased empowerment of regulatory bodies to play a greater role in issues including competition, disclosure, greenwashing and cyber security has made them a critical stakeholder group. 

The group of CA leaders at our corporate reputation roundtable agreed that to be successful in this landscape, they must take a strong stance in proactively advising Boards and CEOs on policy and decision-making around current and potential issues. The approach from CA should go well beyond creating a reactive communications strategy once a problem has emerged, with one leader commenting: “You can’t communicate your way out of an issue you’ve behaved your way into.” In this context, it’s vital that CA leaders are not only attuned to issues that may impact their company, but also have strong relationships with senior leaders and can strategically influence decisions at the highest levels.

Cyber security in the spotlight
One significant issue rapidly rising up the agenda for CA leaders in Australia is cyber security breaches and the havoc they can wreak on a company’s reputation. The BlackBerry Quarterly Global Threat Intelligence Report found there were over 67,000 cyber attacks in Australia in the first three months of 2024, meaning the country rose to fourth globally for most attacks stopped. 

The sheer magnitude of a cyber incident in terms of impact on reputation can make the risks associated with litigation and other areas pale in comparison. However, the way an organisation communicates during a cyber crisis can significantly alter the outcome. Tactics to prepare for and manage a cyber breach were discussed at our second roundtable session which was particularly well-attended by CA leaders from telecoms and technology firms where the topic is clearly in sharp focus. 

The challenge of operating amid headlines dominated by cyber-attacks on corporations and large-scale cyber-crime was summed up by one Head of Corporate Affairs in the IT industry: “Continuously prepare as though you are facing a Royal Commission, whilst simultaneously focusing on learning, testing and optimising.”  The roundtable group covered some key areas where CA leaders should focus: 

1. Speak truth to power: Sugar-coating or downplaying the impact of a cyber breach doesn’t help. CA leaders need to have a seat at the table, remain calm under pressure and be willing to share the uncomfortable truths that enable leadership to make better-informed decisions. 

2. Balance the cadence and pace of communications: It’s important to respond quickly and demonstrate that you are on top of the problem, but over-communicating can fuel the media cycle and negatively impact sentiment. Finding the right cadence and reassuring stakeholders is key. 

3. Create a Crisis Management Team (CMT): Selecting people with complementary skills to join a cross-functional crisis task force ensures that a separate set of leaders can remain focused on delivering day-to-day business operations and help avoid burnout. 

4. Take a customer-centric approach: Focusing the impact of a cyber crisis on your customers and those directly impacted — not the organisation — is essential. The head of employee communications also plays a crucial role, ensuring consistent messaging internally and protecting employee morale.

Ultimately, for Corporate Affairs leaders in Australia, effective cyber crisis management isn’t just about restoring systems — it’s about safeguarding your brand and ensuring business continuity. In a world where reputation rules, it pays to craft your narrative wisely and be prepared for the long game. 

The next Andrews Partnership roundtable will be held in Sydney in September 2024, get in touch with chris@andrews-partnership.com for further information.