29/05/2015 13:54 BST | Updated 28/05/2016 06:59 BST

The Thomas Cook Affair - Why Big Companies Need to Start Thinking Like Journalists

Looking back at its handling of the tragic case of two small children who died from carbon monoxide poisoning at their hotel, Thomas Cook will undoubtedly be quoted for years as a case study in 'what not to do'. Almost everything they could get wrong, they did. Lack of engagement and help for the family after the incident - check. Lack of a proper apology until far too late - check. Lack of effective media engagement to explain themselves - check. Rigid pursuance of the company's own legal entitlements, apparently at the expense of all else - check. Since publication of the Mail on Sunday splash on 17 May, pointing out that Thomas Cook had received many times more compensation than the parents following the the deaths of their children nine years ago, its executives have had to endure a daily dose of negative headlines, while those involved have rushed around belatedly trying to make amends. Thomas Cook announced it would donate the compensation it received from Bobby and Christi Shepherd's deaths from carbon monoxide poisoning at their Corfu hotel to UNICEF, even though it had previously claimed the money was owed to the company itself from the hotel owner and its insurers, to cover costs and loss of reputation. It was then revealed that Harriet Green, the company's boss until last November, was in line to be granted a payout of over £10m based on the share price turnaround during her time at the helm. Ms Green hurriedly found her conscience and said she would donate a third of her bonus to charity too.

All of this was too little, too late. The question is: why was Thomas Cook tied up for so long in due legal process and narrow self-interest, that it failed to see the bigger picture, or to show any humanity? If the journalists at the Mail on Sunday could immediately see that almost any thinking person would be outraged that the tour operator received £3.5m in compensation from the incident, while each of their parents received only £350,000, then why couldn't those highly-paid executives at the company? Neil Shepherd and Sharon Wood had to re-mortgage their homes to pay for their seven-year legal battle during which they 'felt abandoned' by Thomas Cook. Chief Executive Peter Fankhauser told the inquest he felt "incredibly sorry" for the family but did not have to apologise, because there was no wrongdoing by Thomas Cook, although the inquest jury later found the children had been 'unlawfully killed' and that the company had breached its duty of care.

Maybe Thomas Cook received the wrong PR advice, or maybe it received the right advice but ignored it, listening to the lawyers instead who will doubtless have told executives 'whatever you do don't apologise, as then you will appear to be accepting responsibility, and think of the damage to our legal position.' But the cost of the reputational damage to a company from mishandling an incident like this is potentially far greater than the cost of compensation in a court case. In the ten days following the Mail on Sunday revelations, the stockmarket value of Thomas Cook fell by around ten percent, while the rest of the market rose, as customers made clear their disgust at the company's behaviour. It is impossible to predict the scale of any long-term impact on turnover, but businesses around the world are increasingly coming to realise that their reputation is often their major business asset. A recent study by the World Economic Forum concluded that on average more than 25% of a company's market value is directly attributable to its reputation. So I hope the Thomas Cook affair will act as a wake-up call to any big business to 'act human' when a crisis hits - this will almost certainly be in the financial interests of their shareholders, as well as being the right thing to do. Companies looking for a moral compass would do much better if they started to think like journalists - anticipating how incidents like this will play in the media, then taking appropriate action in advance to prevent those negative headlines from being written in the first place.