{"id":78,"date":"2018-06-26T15:00:00","date_gmt":"2018-06-26T14:00:00","guid":{"rendered":"https:\/\/hub.findingsimple.com\/au\/general-counsel-brand-custodian-protecting-business\/"},"modified":"2022-08-03T16:04:04","modified_gmt":"2022-08-03T05:04:04","slug":"general-counsel-brand-custodian-protecting-business","status":"publish","type":"post","link":"https:\/\/insight.thomsonreuters.com.au\/legal\/posts\/general-counsel-brand-custodian-protecting-business","title":{"rendered":"General Counsel as Brand Custodian: Protecting Your Business"},"content":{"rendered":"

While marketing and public relations may be on the frontline when it comes to building a brand, general counsel (GC) is a key member of the defence team, going into battle to protect the value of that brand-building work. According to a recent Morrison & Foerster survey<\/a>, brand equity is a top concern for GCs, with 60 per cent of respondents highlighting it as such \u2013 just behind litigation (69 per cent) and ahead of privacy and data security (56 per cent).<\/p>\n

As a GC, what can you do to better understand brand equity and protect it?<\/p>\n

What\u2019s in a brand?<\/strong><\/span><\/p>\n

Qantas, Apple, CBA, Woolworths, Nike \u2013 they\u2019re all big brands that are familiar to most people. Just the mention of their names is likely to arouse an association with certain products and services, along with other feelings and thoughts. That association and the positive feelings and thoughts, like familiarity and trust, are what make up brand equity.<\/p>\n

Building a brand requires consistent effort across the entire organisation, in terms of understanding the market, being aware of brand values, building products that resonate with the target audience and ensuring messaging is always brand consistent.<\/p>\n

But brand isn\u2019t something that rests solely within the organisation. It also lives in the minds of customers and the public. Anything that affects that perception \u2013 including reputational damage and litigation against the organisation \u2013 affects brand equity.<\/p>\n

Stronger brands mean bigger risks <\/strong><\/span><\/p>\n

Positive brand equity \u2013 the value of a brand based on what customers and the public think about the organisation \u2013 is extremely valuable, driving demand and customer loyalty. For some organisations, the value is colossal. Apple leads the pack, with brand equity valued at a cool $170 billion.<\/p>\n

A strong brand will help drive revenue and customer retention, and shield your organisation from the negative impact of competitive marketing, price hikes and even product recalls. However, being well known and popular has its downsides, with negative events opening big brands to widespread scrutiny.<\/p>\n

Australia\u2019s financial industry is all too aware of this scrutiny in recent times, with the Banking Royal Commission<\/a> uncovering stories of organisations charging fees to deceased clients, manipulating accounts without consent to achieve performance targets, asking clients to sign partly blank contracts and more. Many newspaper headlines, company admissions (including regulatory breaches) and resignations have followed \u2013 as have share price drops<\/a>, significant brand damage<\/a> and calls for industry reform<\/a>.<\/p>\n

With branding involving such benefits and risks, it\u2019s clear that a careful balancing act is crucial. And the bigger the brand, the bigger the risk \u2013 and the more maintenance and protection that\u2019s required.<\/p>\n

GC\u2019s role as brand protector<\/strong><\/span><\/p>\n

Lapses in governance and compliance can attract large fines, but they can also quickly destroy reputation and brand equity, giving GCs two big reasons to make this area a priority. GCs must ensure they\u2019re not only aware of regulatory change, but also that regulatory compliance is built into policies and processes. They need to have a hand in making sure the right people are in place to manage regulatory burdens. Leadership is important when it comes to compliance, so GCs must lead from the top by promoting legal and professional compliance.<\/p>\n

Despite the best measures, things that can destroy reputation and brand equity still happen. So you also need to prepare for the worst by having PR and crisis management resources in place, along with a well-developed response plan.<\/p>\n

Rachel Launders, General Counsel and Company Secretary at Nine Entertainment Co. and Practical Law Australia Advisory Board<\/a> member, knows how important it is to get the right team in place to respond to the \u201cworst-case scenario\u201d. She was a key player in Nine\u2019s response to the 60 Minutes<\/em> Beirut issue, where four staff members from the program were arrested. She explains how a well-coordinated response helped her and her team minimise the impact on Nine\u2019s reputation following the incident:<\/p>\n

\u201cThis was a completely unexpected event and not something we\u2019d planned for. But we quickly set up the key internal group who managed the company\u2019s response. We were in very regular contact with all key stakeholders \u2013 the Board, employees, families of the affected staff, our local legal counsel and other advisers, particularly until our staff were released and able to return to Australia. We were also focused on managing relationships with our regulators. We then moved into looking at how the events came about, what learnings we should take from the situation, and what changes we needed to our policies and practices to avoid a similar situation happening again. The good communication throughout the process and the prompt attention we gave to looking at what happened and why minimised the impact on our reputation, as it was clear to all that we were taking this very seriously and were committed to avoiding a repeat.\u201d<\/p>\n

How to become a true brand protector<\/strong><\/span><\/p>\n

Becoming a brand protector (or custodian) is about being more than just aware of your organisation\u2019s brand and reputation, and how much these are worth. It means taking active steps to protect and maintain brand equity.<\/p>\n

Becoming a respected voice within senior leadership circles, with credibility on business as well as legal matters, is a key part of this proactive approach. How? You must:<\/p>\n