BRAZIL Law and Practice Contributed by: Thaís Vasconcellos de Sá, Bermudes Advogados
3.4 Crisis Management Team The crisis committee should have a leader who holds a high-level or executive position within the company, ensuring that final decisions can be taken if there are disagreements between committee members; there should be a direct line of communication with management, in case any measure requires approval at manage- ment level (which can then be done efficiently). Within the first days or months following a crisis, the crisis committee will usually be on call 24/7 and have daily updates and meetings to decide on the next steps of the response. Less recur- ring and fewer meetings shall be considered only after the crisis response demands decrease, which can take several months depending on the nature/extent of the crisis. Direct Lines of Communication, While Keeping the Committee Independent Within a Proper Mandate The crisis committee should have a direct line of communication with management, which can be ensured both via: • having representatives from the executive committee on the crisis committee (consider- ing, of course, whether there is any conflict of interest depending on the origin of the crisis, which shall prevent management from partici- pating); and • establishing a recurrent report between the crisis committee and management (usually in hourly intervals during the first days/months, and then switching to daily, weekly or bi- weekly intervals when the situation starts to de-escalate). However, it is paramount that the crisis commit- tee has the mandate and autonomy to make the necessary determinations for properly address-
• the legal department; • the technical/industrial area for contributions regarding business continuity, specifically including representatives of the department that managed the risk from which the crisis originated (in the case of a crisis arising from an internal risk); • the communications department; • the investor relations team; and • the governmental relations department. All these areas need to be aligned and integrated for an efficient and adequate response to a cri- sis, and their representation at the crisis com- mittee will ensure that the respective views are taken into consideration when implementing the response. One of the most important aspects of structuring a crisis committee is allocating a proper man- date to its members that is both sufficient for a proper response and adequate for their respon- sibilities and budget. Attributing extensive man- dates without proper autonomy will only bring potential liability and accusations by third parties on the adequacy of the response; on the other hand, an over-extensive and general mandate can contribute to an unfocused, uncoordinated and ineffective response. There is no need for complete independence of the crisis commit- tee from management, as the lack of an internal report could also lead to an uncoordinated and ineffective response. If the specific circumstanc- es of the crisis recommend that one or more members of management not be involved in cri- sis response, usually the most adequate meas- ure is to temporarily substitute said members with other executives rather than change the reporting lines of the crisis committee. Proper and Adequate Mandate, While Keeping an Internal Hierarchy Report
26
CHAMBERS.COM
Powered by FlippingBook