BRAZIL Law and Practice Contributed by: Thaís Vasconcellos de Sá, Bermudes Advogados
5.8 Insurance It is common to have insurance policies deal- ing with potential liability for litigation and crisis- related costs. Receiving coverage will depend on the company’s ability to demonstrate that reasonable steps were taken to mitigate risks of exposure for such litigation, and to defend its interests when the crisis-related litigation arises. Keeping a robust record of documents related to the origin of the crisis (if related to a risk inherent to its activities) and to the company’s response efforts is paramount for supporting a claim for coverage from insurers. 5.9 Reputation Management A crisis will invariably affect the reputation of the company, particularly if it arises from an indus- trial accident or the materialisation of other activity-related risks. Rebuilding this reputation will depend on the company’s ability to properly manage the crisis and its consequences from the beginning, and to adequately communicate such measures to the general public (via media channels and proper communication channels of the company), the affected communities and third parties (if any) as well as the competent authorities. The company should adopt a proac- tive approach to ensure transparency and reli- ability, but should avoid communicating infor- mation that is still uncertain, particularly during the high points of the crisis. External statements should always strive to communicate the infor- mation objectively and with language adapted to the respective target audience. 5.10 Mandatory Report As part of its efforts to adopt a proactive approach of communicating to relevant stake- holders, it is important to observe all applicable regulatory reporting requirements related to the company’s activities during the crisis. Usually, Brazilian regulatory bodies will also demand new
recurrent reporting in their respective areas of competence, which will need to be adequately organised and addressed as part of response efforts. One should expect the recurrence of these reporting deadlines to be challenging, particularly within the first days/months after the crisis. 6. Communication 6.1 Co-Ordination of Communications Co-ordination of the responses to external demands and communication with the media and stakeholders is essential for maintaining these relationships, creating avenues for eventu- al settlement agreements necessary to address the crisis’s consequences, and preserving the company’s reputation throughout the crisis. This is a significant task of the crisis committee, and having external counsel with experience in cri- sis management is key to help find that delicate balance between transparency, consistency and legality. 6.2 Internal Communication The roles and members of the crisis committee should be pre-established, as much as possible, within the company’s internal procedures and norms for crisis response. When a crisis is identi- fied, the committee members should be imme- diately informed and united in taking immediate response actions. The executive committee/ managers of the company should also be imme- diately informed. These lines of communication (including who contacts who and through what channels) should also be part of the internal pro- cedures. 6.3 External Communication When communicating with the media and public, the company should keep its messages trans-
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