What do Doughnuts, Coffee, Bagels and Nazis Have in Common?

JAB Holdings Company Confronts its Owners’ Ugly Past with Honesty and Transparency

3/25/19 – – Look back far enough and you’ll find a skeleton in just about every organization’s closet. Fortunately, the skeletons most companies find are not as ugly as the one discovered by JAB Holdings Company, which has ownership interests in such popular consumer brands as Krispy Kreme Doughnuts, Panera Bread, Coty, Pret A Manger, Caribou Coffee, Bruegger’s Bagels, and Keurig Dr. Pepper.

According to the Associated Press, the German family that controls the Luxembourg-based private investment company has decided to reveal and atone for the regrettable Nazi-era behavior of its ancestors. Descendants of the men who led the business during World War II, Albert Reimann Sr. and Albert Reimann Jr., commissioned a University of Munich historian to answer troubling questions about the company’s past. The recently completed study uncovered enthusiastic support for Adolf Hitler’s agenda and the wide use of forced labor (Russian civilians and French POWs).

When the research findings appeared this weekend in the German newspaper Bild, JAB Managing Partner Peter Harf admitted, “There is nothing to gloss over. These crimes are disgusting . . . Reimann senior and Reimann junior were guilty . . . they belonged in jail.”

Adding, “we were all ashamed,” Harf announced that the billionaire Reimann family would be making the entire report public and donating 11 million euros (about $11.3 million) to still-to-be-determined charities.   

In Chapter 3 of The Crisis Preparedness Quotient – Measuring Your Readiness to Weather a Reputational Storm (“Where Crises Come From”), we focus on nine sources from which the majority of survival-threatening situations spring: people, products, priorities, policies, performance, politics, procrastination, privacy and past. Clearly, JAB is dealing with a crisis anchored in its past. 

It appears that the company is responding with honesty and transparency. That’s good. Organizations and individuals can control their own destinies as much as possible by encouraging an honest examination of their histories, warts and all. Better that you lead the discussion than allow your detractors or competitors to dig up the dirt and define your heritage. By commissioning and promising to publish the University of Munich study of its history, JAB is lessening the opportunity for others to reveal it to the world at the worst possible time.

Not to question the sincerity of JAB’s actions, but it could be that JAB management saw the “worst possible time” on the near horizon. Just last week, a Motley Fool article focusing on the future of the company’s interesting collection of high-profile brands included this market speculation: 

The generally closed-lipped company let it be known that it’s considering not one but two IPOs. Details have been scarce, but there’s a lot of ways these companies might be combined even though JAB has done very little of that.

Imagine the impact any fresh revelations regarding JAB’s Nazi-era history would have on an IPO road show? That’s the last connotation investors or consumers would want to spoil the experience of enjoying a Krispy Kreme doughnut with a cup of Caribou Coffee!

Regardless of the motivation for and timing of JAB’s proactive contrition, the lesson in crisis prevention is important: If at some point in your life or in the life of your company you harmed people or did something you’re not proud of, find a good opportunity to acknowledge it, apologize and make amends. Embracing your history on your timeframe, under your control, sure beats waiting passively for your past to come back and take a bite out of your bagels.




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