What to Do if Your Business Partner Faces a Public Crisis

When a business partner becomes the subject of a public crisis, a company should verify the facts, speak with the partner directly, tell stakeholders where it stands, review the contract with legal counsel, and decide whether to support, pause or end the relationship. Adidas took 18 days to move from placing its Ye partnership under review on October 7, 2022 to ending it on October 25, 2022.

What should a company do in the first 24 hours?

In the first 24 hours of a partner's public crisis, a company should confirm what is true, hold outside statements until that is done, and put legal counsel and communications leads in the same room. Speed matters, but an inaccurate statement made in hour three is harder to fix than a short holding line.

1. Collect the primary documents, such as the court filing, regulator notice or original report, instead of relying on screenshots and summaries.
2. Write two lists: confirmed facts and unconfirmed allegations.
3. Pause joint announcements, co-branded posts and paid placements that feature the partner.
4. Name one decision-maker and one spokesperson for the company.
5. Log every media, customer and employee inquiry so answers stay consistent.

The two-list step does the most work. It stops the company from repeating an allegation as fact, and it shows counsel exactly where the open questions sit.

Should you speak with the business partner before going public?

A company should speak with its business partner before issuing any public statement, because the partner's account, legal position and timeline set the limits of what the company can responsibly say. A call with counsel present on both sides is the usual format.

Ask what is true, what the partner plans to say publicly, which documents exist, and whether insurers, regulators or other partners have been notified. Then confirm in writing what each side will and will not say about the other. A short written understanding prevents the second crisis, where two companies contradict each other in public.

How do you tell employees, customers and investors where you stand?

Each stakeholder group needs a short statement of the company's position, the steps being taken and a place to ask questions, delivered before the group reads about the situation elsewhere. Employees should hear first, because they are asked about it first.

Statements should describe the company's own actions and avoid characterizing the partner's guilt. The crisis management guide covers holding statements and approval chains in more detail.

What do your contracts allow you to do?

The contract with the business partner sets the available options, including whether the company can suspend work, terminate for cause, demand a response or claim damages. Reading it early keeps the company from promising a public stance it cannot legally take.

Counsel should check for termination-for-cause language, reputational harm or morals clauses, notice periods, exclusivity, indemnification, publicity approval rights and data-sharing terms. This article is general information, not legal advice, and the right move depends on the contract, the jurisdiction and the business structure.

When should you stand by a partner and when should you step back?

A company should stand by a partner when the allegations are unproven, the partner is responding credibly and the conduct does not conflict with the company's own stated values. It should step back when the conduct is confirmed, ongoing, or directly contradicts those values.

Companies that write these criteria into a partnership policy before a crisis decide faster and defend the decision more easily afterward.

What did Adidas do when its partner became a public liability?

Adidas ended its Yeezy partnership with Ye on October 25, 2022, after a review that began earlier that month, and said the decision would reduce its 2022 net income by up to 250 million euros. NPR reported that Adidas stopped Yeezy production and payments to Ye and his companies, and that Gap pulled Yeezy products from its stores the same day.

According to FashionUnited, Adidas placed the deal under review on October 7. Reuters reported that the review followed repeated efforts to resolve the situation privately. During the review, the Anti-Defamation League wrote to Adidas executives asking what more the company needed to review, a sign of how public pressure builds while a decision is pending.

The practical lesson is about timing and criteria. A company that tells stakeholders what it is reviewing, who is deciding and when the decision will come gives them something to wait for, which reduces the pressure to act before the facts are in.

How do you recover once the crisis ends?

Recovery starts with a written review of what the company knew, when it acted and what it would change, followed by updated contract language and a defined way to monitor partners. The review should be honest enough to be useful internally, even if only a summary is shared outside.

• Add reputational harm and morals clauses to new partner agreements.
• Run a public-record and news check on prospective partners before signing.
• Assign an owner for each partner relationship, with a named backup.
• Update the crisis plan with a partner-specific playbook, using the ten steps of crisis communication as the baseline.

The common thread across every step is that a partner's crisis becomes the company's crisis only if the company has no prepared position. The crisis communications failure patterns page shows what delay and improvisation look like in practice, and the crisis communications hub collects the rest of the playbooks.