The new edition of the Chambers Crisis & Risk Management Guide was launched in June 2022. Once again, thousands of interviewees gave us their feedback on the firms and individuals they work with, and it is this extensive third-party commentary that informs our rankings of the leading firms offering legal, PR, cybersecurity, due diligence and other crisis and risk advisory services.
Throughout the research certain themes became apparent about the nature of this work and the types of situations clients were encountering. White-collar crime and regulatory matters remain critical concerns for businesses and their leaders, but to these we can now add supply-chain, sanctions, work-place conduct and cybersecurity concerns. A team at law firm Herbert Smith Freehills has suggested elsewhere that rising inflation and a difficult economy may see businesses having to consider how their executive remuneration plans look when compared with other workforce pay proposals.
Professional advisers in this area are also looking at their own businesses and their own credentials, particularly with respect to ESG initiatives. As one interviewee observed: ‘Increasingly we see emphasis from the clients not only on our advisory capability, but our own value set and what we are doing. We have taken through much more detailed targets in terms of our journey to zero carbon, [to show] we are committed to the space.’ Another source stated that ‘we see an internal commitment to these issues as fundamental to be in a position to advise.’
Perhaps the most obvious recurring theme was that of crisis readiness. Sources told us that businesses were ever more concerned not only with reacting to crises, but also with identifying and preparing for acute problems before they arise. This was a point made by interviewees across a range of advisory services and risk areas.
A US-based lawyer said that ‘companies now want to make sure they get ahead of any crisis and have become more proactive in that sense, whether it is with regards to cyber breaches, sanctions or reputation management.’ A PR expert in the US also highlighted the increased desire of clients to anticipate crises, saying: ‘We’ve seen a big uptick in preparation, and it has become a lot more proactive rather than reactive – making sure you have a crisis plan ready to go if the need ever arises.’
Geopolitical developments also prompted clients to take action to mitigate potential risks. As a UK-based political risk specialist told us: ‘Companies are becoming more aware that they need a crystal ball.’
Governance should play a central role in helping businesses to prepare for and react to critical situations, particularly, and perhaps most obviously, in the context of risks relating to ESG. ‘Companies that make public statements of environmental and social aspirations can mitigate their ESG risk by taking a structured governance approach and defining clear policies, procedures, and management accountability around reaching ESG goals,’ said consulting firm AlixPartners in its Spring 2022 ESG Risk Update, adding: ‘Good governance not only allows companies to do a better job managing ESG risks, but also can help businesses identify measurable opportunities that can be reported accurately and transparently to investors and regulators.’
Whatever the potential crisis, it is clear that business leaders and their advisers are increasingly planning strategies to avoid, or at least limit, the financial and reputational damage critical situations may cause. As Sheila L. Birnbaum and her colleagues at law firm Dechert LLP recently concluded: ‘You cannot stop wars, natural disasters, and bad actors outside of your organisation. But you can do more to prepare for the inevitable. And that preparation will make your organisation safer, stronger, and let you get a better night’s sleep.’
Chris Nicholson is a Research Manager in the HNW/Professional Advisers team at Chambers and Partners, where he works on several publications including the Chambers Crisis & Risk Management, Chambers Litigation Support and Chambers High Net Worth guides.
