Lawyers are paid to minimize legal risk. A CEO's unique role is to balance that counsel against other crucial factors like customer trust, employee morale, and future opportunities. Ceding decision-making entirely to the legal team is a failure of leadership that can lead to catastrophic, albeit less immediately visible, losses.

In analyzing a public scandal, Scott Galloway notes that the greatest damage in a crisis typically isn't the initial event but the subsequent "shrapnel": the attempts to cover up, excuse, or avoid accountability. An effective response requires acknowledging the problem, taking responsibility, and overcorrecting.

When stretching an iconic brand like Tim Hortons with celebrity partnerships, the leadership team proceeds "eyes wide open," accepting that not every customer will approve. This prevents analysis paralysis and allows the brand to evolve without being held captive by the need for universal consensus.

Pressuring individuals or brands to speak on every current event is counterproductive. This external demand often leads to 'performative activism'—watered-down, disingenuous statements made out of obligation, not conviction. True impact comes from speaking on issues one genuinely cares about and understands.

The 'Pratfall Effect' suggests showing a flaw can make a person or brand more appealing. However, this has a major caveat: it only works from a position of strength. A competent brand like Guinness can highlight its slow pour time as a virtue. An incompetent brand admitting a flaw simply confirms its incompetence, making the situation worse.

In just five years, the corporate environment has swung from encouraging open discussion on social issues like race to fearing it. This "whipsaw" is driven by ideological extremes on both sides, making it difficult for leaders to find a rational middle ground for authentic engagement.

True corporate values are steadfast principles that guide a company regardless of the political or social climate. Values that are easily discarded when they become controversial are not core values but rather branding exercises. This inauthenticity risks significant consumer backlash when exposed.

During the Sydney Sweeney ad controversy, American Eagle's marketing team intentionally remained silent, contrary to typical crisis management advice. This allowed them to assess internal data and let the negative sentiment cycle burn out, which ultimately proved successful as public opinion swung back in their favor.

Instead of immediately issuing a statement during the backlash, American Eagle waited nine days. This delay created a vacuum that was filled by other people and media outlets questioning the absurdity of the claims, shifting public sentiment in the brand's favor before they even responded.