How can Tiger restore trust?
Investors are increasingly expecting only best practice, and the firm’s loss of reputation after the listeriosis crisis will prey on it for years, writes Marcia Klein
The way a company responds to bad news can be decisive for investment in it. Yet — despite listeriosis allegedly linked to Tiger Brands’ products was associated with the deaths of 193 people and the illness of countless others — the company seems to be riding through relatively unscathed, as the share price continues to pick up after an initial collapse. This might sound strange, considering that Tiger Brands is likely to come out of this with its reputation hammered and its balance sheet under pressure. By the company’s own calculation, the crisis will cost it at least R380m and up to about R800m. According to analysts’ calculations, it could even run to billions, depending on the outcome of class action claims. Whether a direct link between its products and listeriosis deaths can be legally established or not, the truth is that people have died. And some observers believe the company responded with offish, legally fuelled comments and not enough empathy. The crisis also exposed th...
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