- World-first Crisis Index 300 database reveals share prices plummet by 35.2% on average following a crisis and suffer a 68.6% average drop in earnings per share (EPS).
- Road to recovery is long, with companies averaging 425 days to regain pre-crisis stock levels.
- Nearly a third of the companies’ share prices have yet to recover - 33 companies have delisted due to bankruptcy, acquisitions, or privatisations.
Sydney, 20 March 2025: Corporate share prices drop an average 35.2% and take a staggering 427 days on average to recover from a crisis while some never do, world-first research by SenateSHJ reveals.
When a crisis strikes, the financial fallout can be swift, severe, and sometimes irreversible. The comprehensive financial impact database of corporate crises analyses a range of financial metrics, including the impact on shareholder value and earnings when companies fail to manage reputational risks effectively.
Developed by leading reputation, change and engagement consultancy SenateSHJ, in collaboration with expert data scientists, the Crisis Index 300 tracks over 300 crises. These span 27 stock exchanges and 32 industry sectors worldwide over the past 40 years.
Craig Badings, Partner and Head of Reputation at SenateSHJ, said: “The numbers don’t lie. The impact of a corporate crisis isn’t just a dent in reputation – it’s a direct hit to the bottom line.
“Our data shows that when a crisis erupts, share prices fall fast, earnings tank, and recovery – if it happens – can take years.
“The findings offer a sobering reality check for executives, investors, and regulators alike.”
The Crisis Index 300 reveals that, on average, corporate crises result in a 68.6% drop in earnings per share (EPS), wiping out billions in shareholder value overnight. The most extreme example is the Takata Corporation with an EPS collapse of 4,530% because of defective airbag inflators that could explode when deployed. Following years of airbag recalls and multiple related deaths, Takata filed for bankruptcy in Japan and the U.S. in June 2017.
“Earnings destruction is one of the clearest signals of long-term financial damage,” Badings said. “Once EPS plunges, investor confidence takes a major hit, and reputation recovery becomes exponentially harder.”
The Index shows that 121 of the companies’ share prices never recovered, with 33 of these delisting due to bankruptcy, acquisitions, or privatisations.
Some industries appear particularly vulnerable to extreme financial impacts. The telecommunications sector suffered more than others with share prices plummeting by an average of 64.3%. The energy sector (55.7%) and banking (37%) were also badly impacted. The banking, financial services and insurance sector endured severe EPS declines at 106.4%.
The nature of the crisis plays a significant role in financial impact. Mismanagement, white-collar crime, and environmental damage resulted in the steepest share price losses.
“This data highlights the urgent need for proactive crisis planning,” Badings said. “Ignoring reputational risk isn’t just reckless – it’s financially devastating.
“The Crisis Index 300 delivers real financial intelligence, helping businesses assess crisis impacts by industry, region, and type, track market reactions, and customise risk assessments. It’s a stark warning to boards, executives, and stakeholders: be prepared or pay the price.
“This isn’t theory – it’s a financial roadmap for crisis resilience,” Badings said. “Smart companies will use it to fortify their defences before disaster strikes.”
“Our research shows three essentials for managing a crisis: be clear and transparent, act fast, and show real empathy – or risk losing control of the narrative.”
You can access the Crisis Index 300 data free at: SenateSHJ - Crisis Index 300and read the report here.
About us:
About SenateSHJ
SenateSHJ was founded in 2002 and has grown to become one of Australasia's most successful independent consultancies. It has won multiple awards, including being recognised in the 2021 Holmes Report, which ranked the firm in the top 250 for public relations agencies in the world.
The consultancy works with the government and private sector across the following areas: reputation, engagement, change, digital, executive capability building, ESG and sustainability, insights, research, digital and design.
Contact details:
Lauren Garnet, SenateSHJ
+61 (0) 468 950 006 / lauren@senateshj.com.au
