Exploring Corporate Crisis Communication after COVID-19: The Role of Enterprise Risk Management in (Re)Building Trust

36 Pages Posted: 17 Jun 2022

See all articles by Chiara Mio

Chiara Mio

Ca Foscari University of Venice - Department of Management

Marco Fasan

Università Ca’ Foscari Venezia; Ca Foscari University of Venice - Department of Management

Carlo Marcon

Ca Foscari University of Venice - Department of Management

Silvia Panfilo

Ca' Foscari University - Department of Management

Date Written: June 16, 2022

Abstract

This study aims at investigating whether Enterprise Risk Management (ERM) sophistication shaped different COVID-19 crisis communication strategies. We assess the level of ERM sophistication of the FTSE-MIB Italian listed companies, and we study the pattern of risk communication strategies building on Situational Crisis Communication Theory (SCCT). We find that companies with a low level of ERM sophistication generally adopt a crisis communication strategy based on a “denying/diminish” approach. In contrast, companies with higher ERM sophistication adopt a “diminish/rebuild” strategy. Our results extend previous literature on crisis communication by looking at the unique case of the COVID-19, a non-company-specific crisis that hit all firms. Results show company crisis communication strategies depend on prior risk management characteristics. Thus companies willing to protect their reputation and (re)build public trust because of a crisis should invest not only in risk communication but also in their risk management process.

Keywords: COVID-19, Enterprise Risk Management, Situational Crisis Communication Theory, Risk communication, Crisis communication strategies, Corporate reputation.

JEL Classification: M14, G3

Suggested Citation

Mio, Chiara and Fasan, Marco and Fasan, Marco and Marcon, Carlo and Panfilo, Silvia, Exploring Corporate Crisis Communication after COVID-19: The Role of Enterprise Risk Management in (Re)Building Trust (June 16, 2022). Department of Management, Università Ca' Foscari Venezia Working Paper No. 5, Available at SSRN: https://ssrn.com/abstract=4138688 or http://dx.doi.org/10.2139/ssrn.4138688

Chiara Mio

Ca Foscari University of Venice - Department of Management ( email )

San Giobbe, Cannaregio 873
Venice, 30121
Italy

Marco Fasan

Università Ca’ Foscari Venezia ( email )

San Giobbe, Cannaregio 873
Venice, 30121
Italy

Ca Foscari University of Venice - Department of Management ( email )

San Giobbe, Cannaregio 873
Venice, 30121
Italy

Carlo Marcon

Ca Foscari University of Venice - Department of Management ( email )

San Giobbe, Cannaregio 873
Venice, 30121
Italy

Silvia Panfilo (Contact Author)

Ca' Foscari University - Department of Management ( email )

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