Oxfam’s reputational debacle has continued to unfold this week following allegations in The Times that it covered up its sex party and prostitution scandals in Haiti and Chad, and staff threatened witnesses in subsequent investigations.

The Charity Commission has launched a statutory enquiry. International Development Secretary Penny Mordaunt said Oxfam has “betrayed the public” and most likely “deliberately misled” the Government and regulators. The UK Government may cut off its funding, as could the EU.

Archbishop Desmond Tutu and Minnie Driver have stepped down as Oxfam ambassadors. MPs on The International Development Committee have accused the organisation of “putting their reputation ahead of their beneficiaries.”  And Oxfam has now  been suspended from working in Haiti.

What do you think we can learn from this about how to behave in a crisis?

Five points jump out at me:

1. There’s deep irony in the accusation that Oxfam covered up the scandals – or at the very least played them down – out of a desire to protect its reputation. This almost certainly was the motivation, of course. But this case – like so many others – shows how short-sighted that can be. Oxfam’s reputational fall-out from the perceived cover-up is proving far greater than from the original offences.

2. This saga vividly shows that crises don’t just tarnish the image of the organisation and the people in charge but can hammer the bottom line. Oxfam has had 7,100 (and counting) individuals’ regular donations cancelled in the last 10 days.

And I’d be amazed if a far bigger financial impact isn’t looming from corporate sponsors, which its CEO acknowledges are ‘reviewing their position’. However much we like to think businesses give to charity out of altruism, a large part of the motivation is to burnish their halos. The last thing any company will now feel able to do is boost their CSR credentials by being seen to support Oxfam.

3. It’s vital for leaders to show humility and be seen to take responsibility when things go awry. Oxfam’s directors are profusely apologetic now and promising to put things right. But CEO Mark Goldring initially made matters worse with his petulant outburst in the Guardian last week: “The intensity and the ferocity of the attack [on us] makes you wonder, what did we do? We murdered babies in their cots?”

He’s now had to “wholeheartedly apologise” for those comments, along with everything else.

Oxfam CEO Mark Goldring apologies to MPs

It reminds me of BP CEO Tony Hayward in the midst of the Deepwater Horizon disaster which gushed five million barrels of oil into the Mexican Gulf, destroying the environment and the livelihoods of thousands of fishermen. Complaining “I’d like my life back” was crass and inflamed the situation.

4. A crisis like Oxfam’s can take on a life of its own, acting as a catalyst for further scandals to surface in an environment where the media, government and regulators are hovering like vultures. We now know 26 more complaints of sexual misconduct have been made against Oxfam in the last few days. There may well be more to come. Organisations in crisis need to be aware this may well happen and brace themselves to deal with it.

5. It can also easily spread beyond the original organisation to become a broader industry problem – so other organisations can’t afford to sit back and assume they’re off the hook. Médecins Sans Frontières’ work in Haiti is now being investigated. And is it a coincidence that Save The Children is being hauled over the coals at the same time over sexual harassment of its staff?

Two or more charities embroiled in similar issues smells like a deep-rooted sector problem instead of isolated events (‘predatory men’ using aid work as a means to abuse, as one charity leader suggested) – just as two directors at Save The Children indulging in sexual harassment suggests a toxic company culture rather than a lone offender.

It’s natural for people to imagine charities are staffed by altruistic, principled people – and, in the main, I’m sure they are. But crises like these can easily destroy that impression. The charity sector as a whole – and the vulnerable people they exist to support – could well suffer badly.

Of course it’s always easy to be wise with hindsight. And I’m sure if Oxfam could turn back the clock, it would act very differently. But the lesson is once again for organisations to grasp nettle and deal decisively, responsibly and openly with problems as soon as they arise.

Especially when you’re a charity in the public eye, receiving public money and dealing with vulnerable people, trying to brush them under carpet is always a mistake.

 

What lessons would you draw from the Oxfam scandal? 

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