In light of recent scandals, Fortune's Jia Lynn Ya reminds us how Johnson & Johnson's response to the 1982 Tylenol poisonings is the gold standard for crisis management.

James Burke, then CEO of the company, could have gone down the direction of plausible deniability where, hand on heart, he would declare he had done everything prudently possible to stop trouble happening.

All that would have done would have been to fan the flames of discontent. Instead, the company spent hundreds of millions on a recall and embarked on an enormous public information campaign. It immediately called a news conference, posted a reward for finding the culprit, established 24-hour help lines to deal with inquiries, and instructed doctors to suspend supplies. J&J was just as quick four years later when there were copy-cat poisonings. Straight away it stopped the production of capsules, and introduced tamper-proof caplets.

J&J showed businesses how to turn a negative episode into a triumph.

Of course, history is littered with examples of hamfisted business chiefs who damaged, or nearly destroyed, the reputation of their companies.

Some examples: the 1989 Exxon Valdez oil spill is recognised as the template for PR screw-ups. Its leaders initially refused to talk to media people, and then blamed them for damaging the company's reputation.

Or take Union Carbide's handling of the poisonous gas leak at Bhopal in India that killed nearly 4000 people in 1984, and Shell's performance over environmental issues related to the Brent Spar rig, and the corporate relationship with a brutal regime in Nigeria.

Or the way Nestle's reputation was harmed by the way it marketed formula milk.

And who can forget the Ford and Firestone tyre fiasco in which the companies first blamed consumers for not inflating tyres properly, then turned on each other before they were summoned to Washington to explain the deaths of more than 100 motorists.

PR specialists cite 6 golden rules:

1. Work with authorities and recall faulty products straight away. If the company is stonewalling, agencies will step in.

2. Be upfront providing the public with information and apologise. But won't an apology increase the risk of litigation? Not necessarily. There are hundreds of different ways of saying sorry without jeopardising your legal position, but in the end, you need to express regret and sympathy. Otherwise, you just come out looking like you're protecting your backside.

3. Go out of your way to show you are doing everything possible to solve the problem.

4. Identify your vulnerabilities, find ways to stop them blowing up, have a plan for what to do when the worst happens and keep the plan updated.

5. Develop strong relations with employees and customers.

6. Keep competitors in the loop. That helps stop shockwaves flowing through to the rest of the industry.

24 May 2007