Usually only a limited group of people have access to a business’ detailed financial reports.
But last week 270 pages of News Corporation’s financial documents became publically available after a leak to SmartCompany’s sister publication Crikey.
The original documents have since been taken down by Crikey, but the business and its’ staff are now struggling with the ignominy of having its dirty laundry aired in public.
The day after the leak, News Corp chief executive Julian Clarke told a media forum in Sydney he wasn’t overly concerned about the leaks, and told staff not to pay any attention to the stories in an internal company email.
His words were in sharp contrast to the frenzied response of News Corp’s legal team.
So what are the implications for the internal workings of a company when confidential, and potentially damaging, information is leaked to the media? And what’s the best way to respond?
Tim Harcourt from the University of New South Wales Business School told SmartCompany the number one rule when faced with a leak is to “always be transparent”.
“There’s no point denying it or trying to cover it up,” says Harcourt. “The more covering up you try to do the worse off you will be.”
Harcourt questioned News Corp’s strategy of passing off the figures as being outdated, saying people are more interested in trends over time.
“You’ve got to be fair dinkum about the market,” he says.
Harcourt says in most cases, leaks of financial documents will be of raw data and that data is open to interpretation. Companies therefore have an opportunity to develop a narrative about the data and take their staff into their confidence.
“Give a good narrative, be transparent and don’t hide anything,” he says.
But Harcourt says the fact that there was a leak in the first place suggests a company has bigger things to worry about.
“In the corporate world, not so much in politics, people only leak or whistlebow when they are desperate,” says Harcourt.
Change Factory consultant Mike Dwyer agrees, telling SmartCompany the most important thing in responding to a leak is to find out why it happened in the first place.
“Treat it as serious, which it is,” says Dwyer. “It points to systemic cultural or process changes you need to make.”
Dwyer says in these situations, the “damage has already been done” and so the “most sensible thing is to just move on”.
He says the best thing for the company’s employees is for the employer to be clear on their position.
“You can’t control everything an individual says and who they say it to. The best you can do is widely circulate your position and where important to, have meetings to discuss the official response.”
“Tell them what the corporation is saying and give them the opportunity to sign up to that.”
“You can’t put words in people’s mouths, so if they want to tow the company line, they will use their own words.”
Psychologist and chief executive of Seven Dimensions Eve Ash also highlighted the importance of being open with employees when a leak happens.
“You then need to look at the causes and discuss it as a group,” Ash told SmartCompany.
“Every difficulty a company faces is an opportunity to go forward in a new way,” says Ash.
“It might be painful and horrible but it can lead to bringing everyone together.”
Ash says the best way for a company to respond to a leak of confidential information will also differ from case to case and whether or not the company is public. In the case of public companies, there are shareholders to think about as well.
“It would be interesting to talk to Goldman Sachs staff, for example,” says Ash.
“Any company that goes through some form of public exposure really needs to do a lot of talking internally because everyone wants to talk when this happens, the people who work in those companies become a focal point.”
While Ash says a company will usually designate one spokesperson to field questions, the employees of the company will be faced with questions from within their own circle of family and friends and they need to have confidence in their response.
“There needs to be a strong message internally and all individuals should be part of that so they are not talking down their own company,” says Ash.
And the situation is amplified on social media, says Ash, who says the discussion should not be limited to the rules about what can and cannot be said on social media platforms.
“You need to talk constructively about what we are going to do,” she says.