Socio-political risk after a major incident
This blog updates my 2015 presentation to the Risk Management Institute of Australasia WA Conference titled Critical Incident Recovery: Risk Communication. A decade later, the core message is more urgent than ever: organisational risk often begins after the incident ends.
When a critical incident occurs – whether it’s a fire, a data breach, a collapse in service delivery, or the exposure of unethical conduct – the first instinct is technical: fix the problem, respond to regulators, issue a statement, manage the damage. But that’s not where the story ends. It’s often where the real story begins.
Two wavelengths: Incident vs socio-political risk
In almost every incident I’ve worked on – whether in mining, energy, government or social services – I’ve seen the same pattern. Operations move into recovery mode. The team wants to focus on practical solutions. The CEO wants to steady the ship and move on. But the community, the media, and the wider stakeholder landscape are on a different wavelength.
Take Juukan Gorge. The destruction of a sacred site by Rio Tinto in 2020 triggered immediate outcry – but the reputational fallout unfolded over months. Why? Because while the operational response was well underway, the public was still forming its moral judgement. Executives spoke of lessons learned. The public heard defensiveness. Shareholders rebelled, a senate inquiry followed. The blast was devastating enough, but the company’s early handling of the aftermath amplified the damage to its reputation, and drove political intervention and system-wide reforms.
Or take the Robodebt scandal. The scheme was dismantled and repayments began years before the real reckoning arrived. But the public didn’t care that the program had ended, they cared that it had happened at all and that no one seemed to truly accept responsibility. The Royal Commission exposed not just bad decisions, but a culture of denial, delay, and institutional callousness. The government’s legal posture only made things worse. When trust collapses, it’s usually not because of the facts but because of the failure to own them.
Then there’s Qantas. A proudly Australian brand found itself flailing under public scrutiny – not over one major event, but a slow burn of customer frustration, high ticket prices, and tone-deaf leadership. While Qantas insisted it was recovering well post-COVID, the public heard a company out of touch. Confidence crumbled. The CEO stepped down early. And once again, the real damage occurred during recovery, not the crisis.
These stories all illustrate what I’ve long argued: that post-incident recovery is not just a technical process. It’s a socio-political terrain, and it requires a very different kind of leadership.
Recovery demands a different voice
In 1990, BP Chair James Ross faced a massive oil spill off the California coast. The lawyers said it wasn’t BP’s fault. But Ross said something that still resonates:
“Our lawyers tell us it’s not our fault. But we feel like it is, and we’re going to act like it is.”
That statement turned the tide. Activists backed off. Regulators leaned in. Why? Because BP showed moral leadership. They didn’t wait for a court ruling to do what was right. They positioned themselves as responsible, not just liable.
A decade later, the company again faced public anger, this time in Papua New Guinea following several tragic kerosene-related deaths. This time, spokesperson Neil McMaster made the company’s position clear:
“Our reputation’s important, but it comes second to people’s lives. That’s where our focus is.”
In both cases, the public saw something rare: corporate leaders speaking like human beings. Not like PR departments. Not like lawyers. Like people.
That matters more than ever. In a world where outrage travels faster than facts, the public no longer waits to be convinced. They watch how you respond, they listen for tone, they weigh your values. They don’t expect perfection, but they do expect presence.
Social capital is a real asset
In 2025, we’re seeing social capital tracked like any other risk metric. ESG ratings consider stakeholder trust. Reputation analytics flag community discontent. Boards are asking about trust KPIs. But this isn’t new.
What’s new is the recognition that social capital is a strategic asset. It’s what you draw down when things go wrong. And you can’t fake it in the moment. It’s built, or eroded, over time.
The companies that recover well from a crisis are usually the ones who went in with some trust in the bank. The ones who didn’t? They borrow on bad terms, or they collapse entirely.
Leading the next narrative
The recovery phase is your chance to lead. Not to survive. Not to spin. To lead. The crisis has already defined the problem, but recovery gives you the opportunity to define the future.
In the wake of Robodebt, some departments are now pushing for deeper reforms to how automated decision-making works. In the aftermath of Juukan Gorge, others in the mining sector are rethinking heritage protocols and governance in their relationships with First Nations. These kinds of reforms are directed towards mitigating future crises, or building the social capital needed to survive them.
We’ve also seen this play out on a global scale with Microsoft. In the face of growing concern about the risks of artificial intelligence – misuse, bias, lack of oversight – the company didn’t wait to be caught out by a scandal. Instead, it anticipated the socio-political risk and acted pre-emptively. Microsoft introduced voluntary governance frameworks, published responsible AI principles, and actively lobbied for stronger regulation, even when it would apply to its own products. This wasn’t just about avoiding future backlash. It was a deliberate choice to lead on values, not just compliance. It gave Microsoft credibility, influence, and control over the direction of reform.
That’s what recovery looks like when it’s done well. Not silence. Not spin. Not retreat.
The real test of leadership
Ultimately, the recovery phase asks one thing: what kind of organisation are you really? Not who you say you are. Not what your policies claim. What your actions reveal – especially when it’s hard.
This is where leadership matters most. It’s in how you show up, what you say, what you do. Whether you show humility, whether you listen, whether you let values lead.
In recovery, the public isn’t scoring your technical response. They’re evaluating your character. If that sounds uncomfortable, good. Because that’s the only space where real trust can be rebuilt.
If you’re planning for ESG risk, but not post-incident outrage, you’re exposed
At Risk Communication Australia, we help boards and leadership teams to:
• bridge the gap between operational recovery and socio-political risk;
• craft communications that build trust, not just compliance;
• equip leaders to lead publicly, not just internally.
If you’d like a sounding board or a tailored workshop for your executive team, let’s talk.
DM me on LinkedIn or reach out at https://riskcommaus.com.au/contact/
