New survey shows that only half of European firms have a crisis plan in place in spite of the significant financial and reputational benefits of crisis preparedness

London, 5 November, 2009 – Burson-Marsteller, a leading global public relations and communications consultancy, today launched a survey on crisis preparedness in business. Although 60% of the business decision makers polled have experienced a crisis and more than half of these have experienced one in the past year, only 53 percent currently have a crisis plan in place, the survey found.

The survey also found widespread agreement among business leaders that the uncontrollable and uncertain nature of a crisis means it poses significant threats to a company’s reputation. A business which is well prepared can save nearly one third of the average cost of overcoming a crisis compared to a business which is not prepared, partly because the average recovery time is two months shorter (an average of seven as opposed to nine months).

“This new study shows that crisis preparedness directly affects a company’s bottom line. We work with our clients on many different levels to help them relate to and communicate with multiple stakeholders when a crisis hits and on how to implement an evidence-based approach to crisis communications”, said Jeremy Galbraith, CEO of Burson-Marsteller Europe, Middle East and Africa (EMEA).

“In an age of uncertainty, with increasingly complex stakeholder arenas for corporations and the speed of events driven by digitalisation and globalisation, crisis preparedness is more important than ever. Risk assessment, planning and training crisis teams helps companies manage risks, protect trust capital in relation to key stakeholders and to limit negative impact on the bottom line“, commented Anders Bylund, Head of the EMEA Crisis Practice at Burson-Marsteller.

One of the findings of the survey were that businesses without a crisis plan can expect to be harder hit in terms of loss of revenue and layoffs than companies that are well prepared. Other consequences of crises can include falling share prices, loss of corporate reputation, loss of media and/or public trust and law suits by individuals or groups. Examples of companies who have suffered from a crisis over the last year in Europe are British Airways with the Terminal 5 disaster and a wide range of financial institutions, which have been even worse affected by the financial meltdown due to poor crisis preparedness and bad crisis communications.

The survey was presented at a meeting of crisis communications professionals hosted by Burson-Marsteller in London on 4 November where 60 senior communications executives from large international corporations across EMEA and crisis experts met to share insights and experiences on crisis and risk management.Key note speaker at the event was Michael Chertoff, former Secretary of the US Department of Homeland Security, and Chairman & Managing Principal of the Chertoff Group, a security and risk management advisory firm.”The most costly miscalculation that a business can make today is neglecting to invest in its own preparedness,” said Secretary Chertoff. “Some crises are unavoidable, but thoughtful planning and preparation can significantly minimise the potentially debilitating business fall out. Companies that make the investment to prepare in advance of a crisis will ultimately be positioned to respond and recover faster than their competitors.”

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About this study

As part of a survey designed to evaluate the consequences of crises for businesses in Europe, Penn, Schoen & Berland Associates conducted a total of 200 online quantitative interviews among business decision makers across Europe. These surveys were undertaken in the UK, Germany, France, Italy and Spain from 2 to 6 October 2009. Business decision-makers were defined as aged over 25, employed full time or self employed business owners with significant influence or final decision making power in their business.

About Burson-Marsteller

Burson-Marsteller, established in 1953, is a leading global public relations and communications firm. It provides clients with strategic thinking and programme execution across a full range of public relations, public affairs, advertising and web-related services. The firm’s seamless worldwide network consists of 72 offices and 58 affiliate offices, together operating in 83 countries across six continents. Burson-Marsteller is a part of Young & Rubicam Brands, a subsidiary of WPP, one of the world’s leading communications services networks.

About Penn, Schoen & Berland Associates (PSB)

Penn, Schoen & Berland Associates, a member of the WPP group and part of Burson-Marsteller, is a global research-based consultancy that specialises in messaging and communications strategy for blue-chip political, corporate and entertainment clients. PSB has over 30 years of experience specialising in bringing the lessons from the political campaign trail into the corporate boardroom to give clients the strategic insights they need to beat the competition. PSB has worked on nearly 200 political campaigns and has been personal political and strategic advisor to more than 30 heads of state or prime ministers.

Media Contact:

Sabine van Deursen

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Email: sabine.van.deursen@bm.com