Imagine the Unimaginable
This week's blog is by Dana Wilkie, the Council's communications and editorial director. You can reach Dana at dwilkie@pac.org.
Peter Firestein was in his Greenwich Village office - writing a book on crisis management - when he heard the first plane plow into the World Trade Center's North Tower. Just as he sprinted to the roof with a camera, he saw the second plane go into the South Tower. Then he did what any man made of flesh and blood would do: He raced to get his 7-year-old daughter from school, then hit the bank and withdrew $1,500.
Instinct takes over when the unthinkable happens, and when the unthinkable is something like Sept. 11, that instinct is self-preservation.
When the unthinkable happens to a corporation, the instinct is not much different.
That's why it's common for a company to react with self-preservation when first confronted with damaging news. Often, that reaction is to play the news down, in much the way Tokyo Electric Power Co. (Tepco) and Japan's government did last month after an earthquake and tsunami knocked out the cooling mechanism at the Fukushima Daiichi nuclear power plant.
It took about a month for the company and the government - just this week - to conclude that the Fukushima event was comparable to what happened at Chernobyl 25 years ago. In nuclear power parlance, the government "upgraded" the Fukushima event to a "Level 7" emergency, which in plain English means "a major release of radioactive materials with widespread health and environmental effects."
Now the reality is that public perception about nuclear power and radioactivity borders on paranoiac, and is often misinformed. Living next to a nuclear power plant for one year delivers the same amount of radiation you would get living just two days in Denver, watching an average amount of TV for a year, wearing a luminous dial watch for a year or taking one coast-to-coast plane ride. Moreover, the amount of radiation exposure from Japan's event will likely be 50 times lower than the level where studies even start to detect increases in cancer cases.
But with little grounding in the science behind radiation "millisieverts" or "millirems" - and little motivation to learn about something so complicated - most Americans find it easier to believe what rock stars say as they tour the country on anti-nuclear singing crusades. Or what Hollywood actors intone as they testify before Congress looking - with dark suits and thick-rimmed glasses - more intellectual and authoritative than you've ever seen them in People Magazine. And that widespread belief is that radiation exposure from nuclear power, no matter what the level, is always bad.
Still, as any good crisis-management expert such as Firestein will tell you, it's the public perception about nuclear power - not the reality - that company executives must address. One need only turn to similar events of more than three decades ago in our own country - when the Three Mile Island reactors suffered a partial core meltdown - to learn that lesson. The crisis lasted only five days, relatively small amounts of radiation were released, no one was injured, but the accident had an enormous impact on the nuclear power industry. Since then, not a single nuclear plant has been built in the United States, and only now has President Obama won tentative support for new reactors to wean the nation of its dependence on foreign oil.
In a crisis, Firestein writes in his book, "Crisis of Character: Building Corporate Reputation in the Age of Skepticism," "observers of [a] troubled company become its stakeholders. They respond to a crisis as a window into hidden truths about corporations in general, not just the one in crisis. They know that all companies are not deceptive. But they harbor a distinct suspicion that there's more misconduct in big business than ever comes to light."
When Tepco first reported after the March 11 quake that its plant had been compromised, the public heard that three of the company's six units sustained core damage at a "Level 5" rating, which is significantly less severe than Level 7. This week, nuclear power expert Hironobu Unesaki told the Washington Post that "monitoring data available shows that... the government probably knew around March 16, 17 or 18 that it would reach Level 7." In other words, just days after the power-plant crisis began.
This revision of bad news into really bad news doesn't ease the public's collective mind. Instead, it makes people question the authorities who are supposed to keep them safe.
Perhaps worse than this revision were ham-handed attempts at mollifying citizens.
About two weeks ago, Tepco offered the equivalent of $238,000 to each of 10 villages near the reactor. It sounded somewhat generous, until one village complained that the burden of distributing the money wasn't worth the $12 that would go to each citizen.
The company might have meant well. In fact, it acknowledged that the payment wasn't designed to be full compensation - the type that will likely come after years of civil litigation - but instead more of a "condolence" gesture.
Yet when the news about the $12-per-villager compensation went world-wide, the evening's news shows were awash with commentary that Tepco was hopelessly tone deaf.
Just as mind-boggling, Firestein says, was the coverage of nuclear plant workers holding loud, unruly meetings about how to handle the crisis - workers who clearly seemed disconnected from Tepco's leaders. "They didn't have a culture to confront bad news, or to convey it," he says.
Tepco's response to the Fukushima events raises this question: How does a multibillion-yen company - presumably wealthy enough to pay for the best advisors and cutting-edge crisis-management training - bumble so badly?
In Firestein's opinion, Tepco likely prepared for "any tsunami and earthquake that it could imagine." But its imagination, he suspects, was limited. In other words, much as when the terrorist-commandeered planes struck the Twin Towers, no one had prepared for the unimaginable.
"It's impossible to have a plan for every disaster," Firestein concedes, "Instead, you have to have a culture that can communicate in areas of uncertainty... that tells everybody what their job is, where you go, who you call and who's in charge. Does this tell you everything you're going to do in a disaster? Hardly. But it ignites a chain of accountability and the ability to communicate."
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