Big business needs to be so aware of reputational risk. As we have seen with Momentum and Discovery. You can follow the letter of the law, but can still be judged a bunch of shits. I am a client of both these companies, but have been disturbed by the lack of judgement shown them both.
This insurer had every right to refuse to pay out to the widow of someone who was shot. Wait for it…..refusing payment because he had high blood sugar levels, and had not informed Momentum of this.
But what is legal is not always morally right. And by initially refusing to pay out, waiting for their u-turn until being shamed into doing one, the company has caused major reputational harm to itself. Its complacent bosses, living in their smug corporate bubble, did nothing wrong, legally. But, oh boy, when it comes to their image and reputation, they screwed-up big-time.
The Discovery issue is more nuanced, and the wrongs or rights of its actions very much depend on where you sit in this racially-troubled county of ours.
I have no first-hand grasp on the announcement regarding the launch of their new bank, as I was not invited, and received no info. Possibly because my former employer has cut off access to my previous corporate e-mail address. So maybe the invitation is there, out of my reach. Let us give Discovery the benefit of the doubt.
However, looking at social media, they have been strongly attacked by some for one element of their announcement – a decision to offer shares in the new bank to their customers. If they are black.
It is both legal and desirable to extend the economic benefits of our rainbow nation to those racial groups which were victimised by apartheid.
Nothing wrong with ensuring a solid black ownership in the bank to black people. Indeed, I understand that the law requires this.
But what a clumsy way to do it. Good news for the black customers. A big incentive to bank with Discovery.
However…looked at from the perspective of any white people who may wish to bank with Discovery, it is not the same story. They may feel they are the victims of discrimination. Because of the colour of their skin. Remind you of anything, does it?
Could Discovery not have been more sensitive over this issue? Could it not have ensured a large black shareholding in the new bank by some other, non-discriminatory, mechanism? Were they not aware of the perceptions which would arise?
Neither Discovery nor Momentum wished to act illegally. Both were completely entitled to act as they did, and acted within the law.
But the law is just one factor in all this.
Large corporates need to be sensitive to a larger picture, to the race issues and crime which still pollute our country.
Listen to your lawyers. But listen to your hearts as well. Or your customers may tend to suspect you have no heart, nor much judgement either.
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