Ben DiPietro, The Wall Street Journal’s Risk & Compliance Journal, September 21, 2015
This week’s crisis of the week takes a look at the statements and actions of United Continental Holdings Inc., which replaced its CEO and two of his top executives amid a continuing corruption investigation by federal prosecutors.
In a statement, the company said it decided to replace Mr. Smisek and the other two executives as a result of its own internal investigation into its dealing with the Port Authority. The airline’s board apparently decided to cut ties with Mr. Smisek a few weeks before the announcement of his departure. During a conference call discussing its latest quarterly results, the company said it wouldn’t comment further as the investigation is ongoing.
Looking only at what the company has said publicly in its statement and on the conference call, we asked the crisis experts to gauge how well United has handled this crisis.
“‘By the book,’ is how United Airlines said it conducted its investigation of former CEO Jeff Smisek, and by the book is how its board and new CEO have handled every communication regarding management changes. Communications have been textbook–word-perfect, well-vetted and bloodlessly on message. But there are times when ‘by the book’ is simply not enough to do the job, and this is one of them. Extraordinary measures are needed,” says Davia Temin. […read more]