Your crisis communication update: With Kwasi Kwarteng, Boohoo and Betfred!

Reversing a flawed strategy can show strength

Kwasi Kwarteng is having a bad week. When the papers start reporting news of you NOT resigning, it’s a slippery slope. The FT called the current economic crisis “a financial crisis of the UK government’s own making,” the Guardian talks about “fiscal pyrotechnics”, and even the Telegraph reports that Liz Truss has been accused of “inept madness” by members of her own party.

As with any organisation, if you stake your house (or all our houses, if interest rates go up as predicted), on a strategy, and it all goes horribly wrong, you’ll be remembered for how you deal with it. Changing course to avert disaster isn’t a weakness, it’s a strength.

Slow demand for fast fashion

Boohoo is in trouble again. It’s not for failing to tackle poor conditions and below-legal pay in its Leicester factories, nor for selling fake fur jumpers that were, in fact, rabbit fur. This time, the ultra-fast-fashion brand is reporting a 10% drop in revenues and 58% drop in adjusted profit for the first half of this year, blaming the cost of living crisis, and above-average returns of unwanted clothes (something they started charging consumers for earlier this year).

Apparently, our appetite for buying £7 dresses made by underpaid workers in unregulated factories has waned. Ultra-fast.

Greater regulation on the way for gambling companies?

Gambling site Betfred has been fined £2.9million for not making safety checks on people gambling tens of thousands of pounds in a single day. (Although to put that in context, its owners were paid a £50m dividend last year, so this is more about the warning than the money.) The Gambling Commission has said this is an example to other sites, which should take the opportunity to review their own safetly standards and compliance. Another gambling site, Betway, was fined £400k earlier this month after a marketing campaign aimed at children was found on the children’s section of West Ham United’s website.

While the fines may be relatively small, the regulatory headache that could follow should be an incentive for the industry to clean up. There’s a lesson here for other industries, too - if a competitor hits a crisis, take the opportunity to get your own house in order.

Denmark lodges protest against Qatar’s rights record

Many world cup sponsors, players and teams have felt uncomfortable about competing in Qatar this year, on the basis of Qatar’s human rights record (or lack of it). Denmark, although taking part, is taking a stand – and has found a way to protest within Fifa's rules. Players will wear ‘toned down’ shirts, including a black shirt to show mourning for the migrant workers who died building the World Cup stadiums. ENgland men’s captain, Harry Kane, has said he’ll wear a ‘OneLove’ armband as a message against discrimination; same-sex relationships are illegal in Qatar, and campaigners are concerned for the safety of LGBTQ+ players and supporters travelling to the country.

How to deal with the host nation’s stance on human and equal rights is problematic for brands involved in the World Cup, but they could take their lead from Denmark, which put it beautifully: "We support the Danish national team but that isn't the same as supporting Qatar as a host nation."

This article was written by Kate Hartley, co-founder, Polpeo

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