My profession seems to be obsessing on stakeholder relationship management. I see why. When the angry mob is howling at the gates (actually mostly not so much a mob as a media, protester and Twitter scrum), it seems sensible to pretend that crowds have wisdom. Like politicians, media and most bosses in the West, public relations professionals are terrified of seeming elitist. They believe that leadership is no longer possible, or is toxic.

I have often banged-on about how PRs fear that corporations are seen as evil, so now mistakenly believe they must wear a bleeding heart on their sleeve. That’s not my point today. I want to stress here that it is a profound problem that PRs and many organisations – from firms to political parties – dread leadership and responsibility.

There’s a shortage of adulthood

What I’m on about today is related to a wider social problem. I think it’s time the grown-ups behaved like adults.

We live in a society in which people strut about in a macho culture of bullying, slap-head, hyper-fit, scowling aggression, but at the slightest set-back everyone’s weeping and in therapy.

Big cars, sharp suits and watches the size of dinner plates don’t confer anything worthwhile on a person. Aren’t you struck by how fragile the self-esteem of so many modern pseudo-adults seems to be?

We have watched stars, CEOs and politicians behave like greedy, petulant, hysterical teenagers rather than heroes. But what is striking about many of them is that they have so little fortitude. Most CEOs disappeared from view when the credit crunch struck. We have heard how former British Prime Minister Gordon Brown’s inner circle phoned bullying help-lines to complain about him. Their self-confidence was revealed as being wafer thin.

At the World Economic Forum (WEF) in Davos we are repeatedly reminded that profit, shareholder value and shareholders are no longer priorities because all stakeholders are supposedly equal. Such talk comes from Western leaders. The bosses from the East generally hold their nerve and sometimes express disbelief. The split between the two world views has become so stark that Richard Edelman reported enthusiastically from the 2012 WEF gig how Ian Cheshire of Kingfisher, Europe’s leading home improvement retailer, opined that: “we have to get consumers in developing countries past wanting the “American Dream of more.”’

We need corporations rooted in a solid culture

It’s this bifurcation I’m after. I want to try to make it understood that ordinary decency, a workable sense of fairness, a sellable ideal of enlightened self-interest - proper trust between firms and employees and customers and wider society – has to flow from a far deeper sense of corporate culture than can ever be achieved by becoming a weather vane.

Today I want to try to get a proper handle on this particular concern: that our clients cannot afford to aim to become whatever the media or ether-mob, the gobby bloggers, the placard-wavers fancy. They can’t pick up a self-definition by triangulating the top three or four messages they get from a consultant. Even if they did, they’d have to live it and that involves sticking with it and that involves ignoring the next fashion which hurtles into view out of the mists.

I am tolerably sure that floating along on public opinion is never good. It sometimes leads to rushing weirs and crashing Niagras, but more often to long dreary shoals where no-one’s boat floats.

The public says  - or rather the media and campaigners say so supposedly on its behalf –  it wants to humble corporations and corporate bosses, just like it says it wants to humble political parties and politicians. So it has created the risk that firms, parties and institutions become rudderless (sorry, I couldn’t resist another water analogy).

In fact though, if there’s one thing the public fears and distrusts more than strong, mean, unaccountable and self-serving public bodies and leaders, it’s bodies which are too weak to do their job.

Before we can have listening and flexible firms, we need to have firms which are quite strong and quite clear about what they actually want to be.

So the perpetual self-abnegation involved in stakeholder relationship management is a folly. It is a chronic abdication of corporate responsibility. It constitutes a surrender of leadership to instrumentalist short-termism, which causes a loss of vision and direction, encourages low-ambitions and, ironically, undermines public confidence in modern corporations and institutions.

It is a myth that the best reputations must be sustained by stakeholder management crowd sourcing. Good reputations are not based on living within limits set by consumer or voter research and stakeholder engagement, but on breaking down barriers and achieving something significant.

Reputations, trust and success

The best reputations arise from doing things and from keeping promises and delivering results and sometimes from managing failures well. Reputations that endure do so because they inspire.

Great companies and governments transform the world by creating demand and conditions that didn’t exist before. They often do so at great risk in the face of fierce opposition.

There’s more for PR to do than to get their clients to reflect what audiences say they expect or claim that they will accept. There’s more for PR to do than to try to forge consensuses before advising firms to make decisions. Good PR acknowledges that what’s wanted in society is not fixed. Great PR helps society transform the prevailing perceptions of sustainability on business, cultural and environmental matters.

Successful countries from the democratic UK, America and India to today’s undemocratic China (I’ll defend democratic accountability another day) were not built on the back of listening and forging an instrumentalist-driven consensus. They were built on the back of courageous leadership and innovation that won the trust and confidence of their people. This gave the masses things of value  to believe in, such as the American Dream.

Now let’s review a few more conundrums and case studies that highlight how current wisdom is flawed, before I propose my manifesto’s alternative approach.

According to Edelman’s trust survey, trust in business and government today is strongest where stakeholder relationship management matters least and weakest where it seemingly matters most. By a significant margin, China leads the world in both categories and its media are supposedly the most trusted on earth, too. India, Brazil and Indonesia score highly. While Russia records trust levels for both business and government that hover around the same level year-on-year as France’s and Germany’s.

Meanwhile, the PC, the internet and Google’s search engine are all examples of top-down disruptive innovations, not ones driven by bottom-up demand-led engagement-based consultation. They did not arise from listening to the market or to stakeholder groups.

Google

Google’s search engine was an innovative marriage between algorithms and computing power that created its own demand.

The motto of Google founders Larry Page and Sergey Brin was “question everything”. As this review of recent books on Google explains, they were like postindustrial Henry Fords, using digital technology to eliminate all inefficiencies in traditional economies.

Ironically, Google’s Eric Schmidt advocates in a Washington Post piece, Erasing our Innovation Deficit, bottom up crowd-sourced innovation. In it he underestimates the risk-taking top down investment and leadership which helped Google succeed, the internet take-off and the US put a man on the moon: see here. However, that weakness should not detract too much from the mostly timely, insightful points Schmidt makes.

Unloved Microsoft and lovable Apple

Microsoft at its peak never won our empathy; it didn’t need to differentiate itself through branding while it was transforming successfully how we all worked and played on our PCs. Microsoft hardly consulted anybody as it developed what some viewed as monopolistic tendencies. Bill Gates wielded Microsoft’s power like a blunt instrument against all comers, including customers and partners. But if Microsoft was always unlovable, Apple is its polar opposite. Its fans adore it (almost uncritically until recently), believing it to represent an anti-corporate, culturally-fresh, arty sort of an entity. That’s mostly nonsense, but in any case Apple achieved this myth-making with top-down communication and command and control management. Apple’s path was classic old-style branding designed to attack and differentiate itself from a dominant incumbent.

Rock ‘n’ Roll

The electric guitar transformed music. It created new possibilities by creating new sounds. It helped spawn Rock ‘n’ Roll, including Punk, that outraged public opinion. But its hall of fame contains some of the greatest reputations of the last century. But as Simon Cowell shows, even this grass-roots business is managed from the top, even if it draws inspiration and talent from the bottom. It created its own space and its own demand.

Ryanair: nobody’s friend

Last, Michael O’Leary’s Ryan Air’s low-cost digitally-networked business model revolutionised the airline industry. It was an achievement of an aggressive innovative genius, not of stakeholder collaboration, which he despises.

These examples provide evidence of Joseph Schumpeter’s law of creative destruction that drives the capitalist market. They support my argument that PRs who think our trade is all about aligning values, listening, engagement and relationships need a reality check; though I’m very pro using those techniques in the right context and more importantly for the right reasons.

Key manifesto messages

In contrast, I say PRs should be more prepared to defend, advocate and promote risk taking. They should be less concerned about what’s acceptable and what’s popular. They should be more willing to celebrate elitism and success. They should be less concerned with the crowd as it is currently constituted or inclined to emote and opine.

PRs should be more willing to celebrate the arrogance of the change-makers who bring innovation to society. We should be less concerned with bad headlines and with tyranny of media produced crises. Instead we should focus our campaigns on achieving positive outcomes and on getting things done. We should be the torch bearers honing the narratives and messages of the people and forces which challenge or ignore society’s constraints. In that game PR plays a transformative role: we could start by making economic growth our focus.

The blog which got me going

Here’s the article that inspired this manifesto: To listen, to engage: empty buzzwords? Let’s discuss. It sums up the risk adverse stakeholder relationship management approach of mainstream academic PR. According to this school of thought progress depends on winning the public’s trust by establishing empathy. For them it is all about connecting with stakeholders by gathering sense:

“The consequences of the interpretation-of the comprehension-of the gathered sense need to be explicitly related to the listener’s decision making process and are inherently fuzzy, non linear and situational. The competencies are creativity, feasibility, and time framing with their respective tools.”

This piece of gobbledygook is typical of current PR thinking. It springs from a misplaced faith in Grunig’s two-way symmetrical model of PR and an addiction to jargon and spin. Amusingly the author is so sure of his ground that he asks What comes after Grunig? and replies, “the answer to that looming question is that after Grunig…comes Grunig.”

The danger here is that Grunig’s supporters have ended up trying religiously to make reality fit the theory. That’s the trap, if I’m any judge of PR-related text, that the Stockholm Accords, arising from the Global Alliance’s World Public Relations Forum debate, fell into.

In summary, my point is that PR is a multi-faceted, flexible profession. Sometimes it is top-down and one-sided. Sometime it is a two-way interactive real-time force. In whichever way it does its job, however, PR is an objectives-driven art rather than a science that’s reducible to orthodox formulas. My take home message is that PR makes its most useful contribution to society when it advocates transformative risk-taking on which great reputations are built.

This is an updated piece that was first published in February 2010

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In has come a bold recognition that business must be seen, as Edelman’s press release puts it, “as a force for good and [more significantly] an engine for profit”. But – yes there’s always one very BIG one of those – there’s a major contradiction at the heart of the lessons Edelman draws from its own results:

Consistent financial returns, innovative products and a highly regarded senior leadership are primary factors on which current trust levels lie. However, listening to customer feedback and putting customers ahead of profits are more vital to building future trust. [taken from press release: here]

It is as if Edelman is saying profit, innovation, new products and good leadership will win you trust today but not tomorrow. This message is suspect for a number of reasons. For example, trust is strong in business in every part of the world in which there is sustained economic growth. We should note, indeed, that current evidence from China suggests that future trust levels will fluctuate in proportion to the rate of, and the degree to which people are optimistic about, continued growth and social development.

Now let’s look at the cognitive dissonance among the public that Edelman’s survey uncovers. Edelman reports that while business is on average much more trusted than governments across the globe, 49% of respondents want governments to impose more regulations and supervision on business practices. On this point Richard Edelman usefully takes the lead:

The interventions people are asking government to take are changes business can step up and implement on its own [taken from press release]

That’s seemingly a robust pro-business message. Except it isn’t enough. Honesty is called for. In the future the West is going to continue to compete with emerging markets in the BRICS and elsewhere in Asia, Africa and Latin America. As a consequence, many of the calls that the public are now making to restrain and control business are going to have to be resisted; of course that’s not the same thing as ditching corporate responsibility. Winning that argument by challenging the public’s current perceptions will take a protracted and frank debate.

Otherwise it is more likely that business will say one thing and then be forced to do another under the pressures of the real world. Already, business has had to cut back on its biggest social responsibility to its employees and society at large: pension provision. In the future things are likely to only get tougher still on many many fronts – so let’s be straight or we seriously will lose people’s trust.

The key to building and maintaining trust and confidence is not difficult to fathom. Today, wherever there is uncertainty and angst about economic growth in the future, there has been a massive fall in trust and confidence in the present, which looks set to continue if things don’t improve.

Hence the best PR from now on must be focused on making growth happen by removing the barriers to innovation, experimentation and profit making; be they limits imposed by governments or self-abnegation and concessions to protest movements. That calls for a battle for hearts and minds in the realm of public opinion. It will involve making consumerism and corporations chic once again and advocating rapid technological progress and economic development.

The upbeat culture we require to win back trust and overcome cynicism is totally at odds with today’s downbeat anti-growth, anti-technology and anti-corporate, pessimistic climate, particularly in the West with its Occupy Wall St protests. However, as yet, the PR world, including the Edelman PR Agency, does not agree with my viewpoint. So I predict we will continue to remain part of the problem for some more time to come.

See also: Edelman’s wonky 2011 Trust Survey

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They shouldn’t need the warning, but some seem to. This stuff is likely to be claptrap.

The social sciences often get in a muddle when they pretend to be scientific. Economics, sociology, history and pre-history, all blaze the trail here. PR, a trade of fuzzy-logic and rhetoric and impressions if ever there was one, ought to be very nervous when its practitioners affect to have a scientific underpinning.

But here we are with PR academics and some hands-on PRs getting into neuro-science and algorithms to improve, for instance, stakeholder relationships.

The question is just how much can we rely on quantitative behavioural measures and neuro-scientific insights into our brain patterns to assess qualitative human variables such as our opinions and feelings.

There is a school of PR thought that promotes to clients the predictive power of algorithms and neuro-science to assist in identifying the “relationship value” of networks amongst an institution’s stakeholders. PR Professor Toni Muzi Falconi advanced the thinking recently in his piece Improving stakeholder relationships through nets, neuros and algorithms, saying:

“Computer science allows the use of algorithms, which greatly reduce the need to research more than small samples of stakeholder groups. Likewise, neuroscience allows the integration of qualitative and quantitative indicators, which are closely connected to how relationships influence one another.”

Describing what he is looking for, he added:

“Interactions within stakeholder groups (or between the groups) can reveal – through graphics – the primary relationship nodes, as well as their interconnections. A mathematical analysis of these networks, supported by computer-led software, offers the essential numerical elements of specific indicators/variables.”

I accept that in a digital world we can trawl for lots of interconnected data. Yet it would be a big mistake to read too much meaning into what’s revealed. As Heather Yaxley commented on PR Conversations:

“Whether or not we have relationships with brands and whether or not they can, or should be trying to map our relationship is equally problematic. For example I am not a great fan of Carphone Warehouse generally, but it gave great service in replacing my Blackberry. So what does this mean? Nothing. I don’t care about the company, don’t want it to engage me, build a relationship, etc. It provided a service when I needed it – end of story.”

She, not for the first time, is spot on. However my concerns, and I suspect hers, run much deeper. There is something potentially very dangerous and worrying about this trend that puts PR in the hands of the latest psychological and sociobiological prejudices. For anybody who thinks I exaggerate, here’s the first paragraph from a press release promoting the latest edition of Psychological Science, a journal of the Association for Psychological Science:

“Too much choice can be a bad thing—not just for the individual, but for society. Thinking about choices makes people less sympathetic to others and less likely to support policies that help people, according to a study published…”

It goes on to describe research findings which showed:

“Simply thinking about ‘choice’ made people less likely to support policies promoting greater equality and benefits for society, such as affirmative action, a tax on fuel-inefficient cars, or banning violent video games.”

This research reinforces that of other psychologists (including neuro scientists) such as Barry Schwartz, who say we are oppressed and made unhappy by too much choice and freedom. This camp argues that we should limit the scope of our choices and lower our expectations. They say likely as not when given too many choices people will make the wrong ones. They add that anyway too much choice causes stress (according to their brain-imaging scanners and other research etc.).

To persuade us to think the right way and make the right choices, these people believe that PRs should become masters of the subliminal (for which, read ‘manipulative’) message. The Association for Psychological Science press release, for instance, reports Krishna Savani of Columbia University observing:

“’In America, we make choices all the time—in the cafeteria, in the supermarket, in the shopping mall,’ Savani says. He wonders if, in the long run, all those consumer choices might have a cumulative negative impact by making people less sympathetic towards others and less concerned about the collective good.”

So, I guess the implication is that Savani and Shwartz can restrict and then manipulate our neurons to make the choices for us instead. They, of course, unlike us more irrational beings, know what is and is not in the public interest. They can even try to justify the merits of their preferred choices with some research, as Toni Muzi Falconi puts it, “[of no] more than small samples of stakeholder groups.”

The message (I’m not saying it is Falconi’s) from such psychologists seems to be that capitalism, choice and democracy are overrated.

In fact, one of the arguments for PR to adopt neuro-scientific findings is precisely to spot hard-wired human characteristics. This is, I say, a problematic social and neo-eugenic-type outlook. Of course, there is nothing wrong with eugenics in principle: it allows us, among other things, to eradicate some very awful inherited diseases. But we should worry when neuroscientists or geneticists research aims to give scientific weight to ideas that are more philosophical in content (or a matter of prejudice or politics). As we all know, some other very backward ideas in history were once said to have had a similar scientific basis.

That’s why I have to applaud Andrew Mayne’s piece on Matt Ridley’s The Rational Optimist where Mayne said that psychobabble spreads when scientists:

“…suffer from expert bias and assume their expertise in their own field also gives them a proficiency in totally unrelated areas like economics and political science. Add in group reinforcement from their peers and you have a group of politically and religiously homogenized people who have very different ideas from you and I on what exactly ‘the public good’ means.”

I have also to concur with Andrew Mayne’s view that:

“Market theory, evolutionary psychology and neuroeconomics have reinforced what Adam Smith already told us, that the best measure of what brings about the public good isn’t found in measuring just one choice, it’s the cumulative effect of all the different choices that we make as a society. Choice causes anxiety, but it’s an important part of being a human and not a member of an ant colony.”

We should note, then, that if PR is even remotely about helping people make informed choices and about respecting the moral autonomy of different players, the psychobabble runs in the other direction.

Having said that, up to a point I suppose that PRs and marketers do indeed rely on the usefulness of algorithms. For instance, our supermarket loyalty cards and our behaviour on Google allow for useful data-mining to predict what we might be interested in in future. The more supermarkets know about what consumers buy and what types of consumers purchase what types of products and when the better they can serve their customers. Moreover, Google’s entire business is rooted in the smart use of algorithms, which we all manipulate to get the messages of our clients at the top of the pile.

But we shouldn’t get carried away the way that Google’s Eric Schmidt does. He believes that his company’s algorithms can really see inside our minds. He says Google can take serendipity out of the equation. Moving on from telling us how Google is run, he implies that its model could be used to organise the world economy. It could, he believes, enable society to predict electronically in advance what consumers will desire and want in the future. The logical implication being that capitalism can do what communism aims to do, which is to plan production in a conscious fashion; in Schmidt’s world by seeing into our “unconscious” minds to discover what will soon become a concrete demand.

If I may wander for a moment, Schmidt’s view is very Edward Bernays. Now I admire – and sometimes defend – Bernays. He was clever and insightful, but he was a propagandist: a manipulator. His ideas were in tune with - and perhaps inspired – propaganda techniques on both sides of WW2 and the Cold War. And he used it to flog stuff. It is true that he deliberately used ideas about the “unconscious” which he got from his uncle Sigmund Freud. I could argue (in line with keeping science out of PR) that the unconscious is a pre-scientific idea, as old as the Greek Psyche with their sophisticated understanding of art and illusion: so he wasn’t all that scientific or original really. I’d rather argue that when propagandists hope to deploy scientific canniness in the media world to influence mass opinion, I hope and believe that good old unscientific prejudices, and deep-seated ideas and reasoned argument will, if they are allowed to, see through the guff. The success of the Bernays-Goebbels axis (so far as it existed except in the mind of Adam Curtis) was not the success of science, not even in its Freudian form, but the failure of the German mass-mind to detect bollocks.

Ok, now that’s off my chest let’s get back to Schmidt. He believes that most people don’t want Google to answer their questions, but to tell them what they should be doing next. But he sees this as involving more than providing choices. Schmidt views it instead as others deciding (taking the risk and guess work out of the marketplace) in advance which choices we will make:

“The power of individual targeting—the technology will be so good it will be very hard for people to watch or consume something that has not in some sense been tailored for them [in advance].

Though that only works – if for one moment we suspend disbelief and imagine it ever could – if Google plays the role of the communist centralized state by exploiting (and retaining) its de facto monopoly on internet search, aggregation and interaction. But I feel comfortable in saying that will never happen. It won’t happen for the same reason that Schmidt’s reasoning is flawed. Innovation, competition and new risk-taking continually redefine the human experience in new and unpredictable ways, the way Compaq, Microsoft, the internet and Google did recently.

Of course it is wonderful to see a modern capitalist like Schmidt saying that scientific and technological imperatives engineer choice out of consuming and uncertainty out of producing. But the hubris of the thing antagonises one. Doesn’t he know life’s more complicated than that? Doesn’t he spot that if he was right, we might hate him and flock to a search engine that did stuff differently? It is at least intriguing to see a man predicting that what looks like the triumph of his business – information and individualism – is merely the triumph of manipulation. But hold on. This isn’t really manipulation: it’s anticipation as the word ought to be used. It’s not all that creepy or conspiratorial so much as an expression of over confidence.

Every business in the world takes a crack at getting ahead of the taste of its customers. For my money, the better they get at it, the better my life will be. And of course the genius of the modern world is that huge firms are getting better and better at working out the zillions of niches they have to cater to.

Anyway, you readily see, I think, that any claim that all this is scientific is nonsense. It is about as believable as the now discredited, but recently fashionable, idea, which suggested equations devised by boffins could produce packages that strip the risk out of financial instruments and end the boom and bust cycle. So let people aim to map the human mass mind: I imagine they’ll have all the luck which has attended those who try to map a single one.

For more on this from me see here.

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The Economist, for instance, has been quick to trash Edelman’s headline that suggests “Trust Stabilises Globally”. It reports:

“…on closer inspection of the data—garnered by polling members of the “informed public” (college-educated, in the top quarter by earnings for their age and country, etc) in 23 countries—it turns out that, rather than stabilising, in many respects trust is continuing to decline.

It goes on:

“…[the] aggregate picture masks some bad news, especially for the world’s superpower, where the trust Americans have in their government has fallen to a lowly 40%, from 46% last year. Americans’ trust in business has also dropped sharply, from 54% in 2010 to 46%. Trust in business also fell in Britain, from 49% to 44%, though the British feel more trusting towards their government (albeit a hardly ecstatic 43%, up from 38%), perhaps because it is too recently elected to have totally disillusioned them.”

But trust in government in Italy has risen sharply (that must have brought a smile to Berlusconi’s lipstick-smeared lips), though it remains no match for the trust put in Brazil and China’s governments. As The Economist put it:

“Indeed, the level of trust reported in the Chinese government is so high that it makes one wonder if the sort of influential people surveyed by Edelman are reluctant to trust opinion pollsters with their real opinion of their political rulers.”

It is also worth noting that trust in Italy’s media – mostly owned by Mr. Berlusconi – is also up from 38% last year to 45% this year (that compares to the drop in trust in the UK’s media from 31% to 22%). Chinese media is, of course, the most trusted on earth (up from 63% to 80%) . Yeah, right.

What was interesting this year was that Edelman tested how much trust people put in Milton Friedman’s economics and the pursuit of profit as the first duty of business:

“Edelman asked its sample if they agreed with the view traditionally associated with Milton Friedman, the late Nobel Laureate in economics that “the social responsibility of a business is to increase its profits.” The United Arab Emirates proved to be the most Friedmanite, with 84% agreeing, just ahead of Japan, rather unexpectedly given its reputation as a stakeholder-oriented corporate world, with 72%. Sweden, which is also seen abroad as an anti-Friedmanite bastion also scored high, at 60%.

I’ve pointed out before how in Japan a long period of deflation, recession and reality broke the country’s commitment to consensus building. Japan has actually become more enthusiastically capitalistic than ever as it seeks ways to reboot its economy. However, The Economist reports that the public (in this context Europe and America) does not yet see the future the same way Japan does:

“America, supposedly the land of profit maximisation über alles, scored only 56%, and Britain 43%. Less surprisingly, Friedman’s views drew little support in stakeholder-friendly Germany, Italy and Spain, at 35%, 33% and 30%, respectively—ie, less support for profit maximisation than in China, whose nonetheless relatively low score suggests that its public embrace of red-blooded capitalism still has some way to go.”

“Edelman found, there are very high levels of support for the view that firms should be willing to sacrifice some profits to meet their commitments to their various stakeholders. The percentages are startling—91% in Germany, 89% in Britain, Ireland and China. America is only slightly further behind. Even in those countries with the lowest support for this particular view—Brazil, Japan and the United Arab Emirates—there was still a majority who agreed with it.”

The findings no doubt will fuel the argument that says business should work in partnership with NGOs, whose trust levels (up from an average of 57% last year to 61%) remain, on average, significantly below those of the Chinese government. So, if partnering with NGOs is a helpful means of securing a better corporate reputation, one wonders why partnering with the Chinese government would not be even more effective (ask Google, I guess). Of course, China represents the world’s largest and fastest-growing market, so it is an obvious win-win from a business perspective.

But Edelman, you can be sure, will use its results to boost its call to treat all stakeholders as equals. It will use the results to continue advising firms to outsource their reputations to NGOs and to seek ways to “prove” that they are doing well by doing good with the aid of a third party stamp of approval.

The fact that the facts don’t fit Edelman’s narrative – of business and society and shared values – should raise some eyebrows among the rest of us. Perhaps it is time to ditch the do gooding agenda and get back to business?

See also: Edelman’s trust survey interrogated

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Porritt is set to argue that Greenpeace and other environmental campaigners have gone soft. He will say that:

“There’s not a mainstream political party in the world out there challenging the orthodoxy of business-as-usual economic growth – stretching indefinitely into the future. Meanwhile, environmentalists continue to do their best to slow the pace of destruction, but are still losing battle after battle. Worse yet, we’ll lose the war if we can’t free ourselves of our subservient dependence on today’s earth-destroying economic growth”

He will argue that environmentalists have become too focused on creating “islands of conservation”, such as nature reserves, which cannot survive in a world of warming, habitat destruction and pollution. Instead the Greens should focus their efforts on stopping economic growth and development.

For him there is a contradiction between the words “sustainable” and “growth”, which makes the term sustainable growth an oxymoron. This debate is not trivial. That’s because the line that most PRs have been selling to their clients contradicts Porritt’s view fundamentally. PRs have pitched their argument saying that what’s good for the environment is also a catalyst for economic growth. We have advocated that going green boosts the top and bottom lines and therefore should be embraced as a business opportunity by the C-suite and boardrooms. This is the so-called win-win scenario.

Now that Porritt is laying down the gauntlet the response of most PRs will be to defend the status quo. For instance, the World Business Council for Sustainable Development’sVision 2050 tackles how to provide enough food, clean water, sanitation, shelter, mobility, education and health to provide for 9.2 billion humans. Porritt, in contrast, says the world can barely sustain its current 6 billion people. He proposes that world governments commit to limiting population growth to 7.8 billion instead.

However it is my view that we can do better than merely defend our current stance. First off, I think Porritt makes a valid point when he implies that sustainability and development are not comfortable bedfellows. Second, he might also be right, but for different reasons, to say that countries such as the UK should debate immigration and seek to manage population growth without being charged with racism.

We should be more critical about how we have been discussing sustainability issues, is my view. For instance, China’s industrial development, like ours before it, is based on the notion of Joseph Schumpeter’s creative destruction. Describing what that means in practice today, Thomson Reuters recently revealed how China has become the second-largest producer of scientific papers, after the United States. Moreover, research and development (R&D) spending by Asian nations as a group in 2008 was $387 billion, compared with $384 billion in the United States and $280 billion in Europe.

The Reuters report added that an AstraZeneca survey found that 27 percent of people think China will be the world’s most innovative country within ten years, followed by India with 17 percent, the United States 14 percent and Japan 12 percent, according to the 6,000 people in six countries questioned by the drugmaker. Reuters remarked:

“The survey across Britain, the United States, Sweden, Japan, India and China found a strong sense of optimism amongst people living in China and India, in contrast to relative pessimism in the developed Western economies. More than half of those in China and India thought their home countries would be the most innovative in the world by 2020, while just one in 20 Britons thought Britain would be able to claim this title.”

Today’s Sunday Times also reports how the West is being stranded in the doldrums as Beijing throws billions of dollars at its solar panel industry and other alternative-energy companies. It says:

“This partnership between business and government is driving some western solar firms to the wall and threatens to start a trade war in the alternative-energy sector.”

In the face of such challenges, Porritt’s call to give up on economic progress and growth looks pathetic. But there’s also a sense in which a new greener world based on new technologies calls for development, fast-paced innovation and levels of disruption which are going to bring into question the very mantra of sustainability. It also begs an investigation into what degree we can afford to throw out all the old Western growth, GDP, paradigms at the moment when the East (and rest of the world) is embracing them.

It should not escape PRs that optimism and trust and lack of cynicism is highest in the BRIC countries and lowest in the more developed ones, according to opinion surveys from the likes of Edelman. Moreover, the growing split in perspectives between countries in the East and the West on growth and development issues should alert us to the need to be more ambitious and not, as Porritt maintains, less.

But it is not my intention in this post to provide answers, as much as to highlight that the debate about the relationship between development, sustainability and global innovation is far from settled.

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Who was Tiger Wood’s audience when he apologized? Surely, he wasn’t speaking to the public because he has not really offended it, has he? Surely he wasn’t addressing his wife either?

On the contrary, he said his wife was blameless, which immediately provoked the responses (a) we knew that already, dummy; and (b) now I don’t like you for the way you’ve spoken about your wife in a PR thingy. So let’s get this straight: until the apology none of us had any reason to think he was a prat, like it was our business anyway.

The truth is presumably that Tiger Wood’s made his awkward apology for the benefit of his future at least partly with his sponsors. But the thought that they were previously completely oblivious to Tiger’s love of luscious ladies is too naive to believe. Tiger was rampant in his enthusiasms off the course. So if Tiger made a mess of his apology it was perhaps because it was insincere except for the regret at getting caught and having to clean up the mess.

But whatever the critics like me may say, what the hell else could Tiger Woods do? And doing it badly may be better than not doing it at all. The reality is that there’s a threatening popular culture at play in society which shrills, “apologise, reform, move on, or we’ll bring your house down.” Besides, one needs to shut things down: if Mr Woods hadn’t said his piece – at length and comprehensively – his re-entry to public life would have been dogged by the media’s sense that there was still some meat on the bone.

One could blame the media. But I don’t. The media reflects popular culture rather than makes it. No, it is the the two-faced smirking sponsors that I blame, and the public whose judgement they fear, of course. Tiger Woods couldn’t resist, for instance, taking a swipe at Accenture in his apology, whom he called “friends”, but who actually walked out on him.

On the face of it, the sponsors are right to be nervous. According to a survey conducted for PRWeek about the John Terry affair, 62 per cent said footballers’ personal lives shaped public opinion of them and a significant 71 per cent thought footballers appeared “above the law”. The funny thing is that neither John Terry or Tiger Woods has broken any laws, but that’s an aside. The public seems to demand of public figures what it would never demand of itself.

Sponsors fear cross-contamination between their chosen ones’ fallen reputations and theirs. This has created a risk-adverse climate. They and the public have become stuck in a cynical cycle of expressing moral outrage at exposures of what would once have been of little concern to anybody but the families of those involved.

But I don’t think we should take the public’s prejudices too seriously because the public doesn’t take them seriously either. So my call is to bin the research findings.

Here comes more advice. If sponsors want to appear authentic, they need to stop creeping to shallow and shifting public opinion. When the sponsors’ stars are found wanting in some way, they should stick by him or her. I am pretty sure the sponsors’ realism and their loyalty will resonate well with the public.

Can’t we respond like adults to the frailties of our super stars? What do you say?

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The survey is much less gloomy than it was a year ago, so two cheers for that.

According to Edelman, trust in business has stabilized and is trending upward, with a substantial jump of 18 points in the US (from an all-time low of 36% in 2009 to 54% in 2010). Trust in business falls into three categories (High: Brazil, China, India, Indonesia, at 60-70%; Middle: Canada, Japan, US, at 50-59%; Low: France, Germany, Russia, UK, Korea, at 35-49%).

Moreover, Edelman reports that the three leading factors burnishing corporate reputation are now “quality products and services, a company I can trust and transparency of business practices.”

Financial results are now the least powerful factor in positive corporate reputation in most regions.

Overall it is all good news, but some of the conclusions are questionable.

Edelman’s survey reveals that trust in business is highest in some of the world’s least democratic countries.

The results don’t really support the notion that financial results matter least in most regions. It would seem that trust is high where performance is strong and weak where it is not. The modest recovery in trust in the weaker regions appears to be in line or apace with the recovery of economic fortunes there.

Transparency seems to matter most where results have been poor, and least where they have been good.

Moreover, the banking industry has suffered a profound fall from grace, with three-year declines of up to 39 points in markets ranging from the UK to the US to Germany. But banks remains highly trusted in China and India. While the automotive sector staged a comeback and is very highly ranked in developing markets.

I’m not surprised by these results. Scapegoating bankers has become a popular sport among politicians seeking popular appeal. Consumers in developing countries are now enjoying cheap motor cars and motoring, which their booming economies can deliver on a large scale.

But it is surely nonsense to imagine that Chinese and Indian banks are more responsible, more ethical, better managed and more trustworthy than their Western counterparts.

According to Edelman, NGO trust has jumped profoundly in China in the past six years, from 31% to 56%, a level comparable to that found in Western Europe, India and the US. It seems that about 70% of respondents trust a company more when it partners with an NGO on important social issues.

But I ask myself whether partnering with NGOs is behind the high trust levels of  Indonesian, Indian and Chinese businesses compared to their counterparts in London, Amsterdam and New York.

Moreover, when people say they trust a company more when it partners with an NGO, we should ask some tough questions.

Does a firm partnering with an NGO acquire a share in the other’s reputation or vice versa? If it’s the NGO which confers trustworthiness, what exactly does the respondent trust in that relationship?

A partnership with an NGO does nothing to alter core business practices or performance, which is the real trust business needs to have bestowed upon it if it is to function effectively in the market.

According to Edelman, this year, business tends to be more trusted than Government. Government trust has risen in the US (substantially), France and Germany, but fell in Russia and was mostly stable elsewhere.

I’m surprised by the US result. Polls and election results there suggest that trust in Barack Obama’s regime is collapsing fast. It’s collapsing faster than anything George W Bush experienced in his first term. Obama, it would seem, is more popular abroad than at home.

Last year, by a 3:1 margin of Edelman’s respondents said that government should intervene to regulate industry or nationalize companies to restore public trust. Now it seems business is making a comeback in terms of favourablity.

That seems likely. But as governments seek to reduce their level of public debt the cuts will probably soon make governments more unpopular than ever. It is almost as if having got what they wanted, respondents will turn on governments when the latter attempt to balance the books (they’ll also turn on those governments that don’t).

Edelman’s survey reports that the credibility of chief executives has recovered but remains well below that of academics, financial analysts and NGO representatives. In a reversal of past trend, a “person like myself” has seen a drop in trust and fellow employees has remained stable, now at levels comparable to CEOs.

As a PR I welcome this. I think the results reflect how our business has helped CEOs reappear armed with messages. But clearly there’s more work to be done on that front. I’m also chuffed to hear that “persons like myself” (so to speak) are losing credibility and that expertise is once more rising up the scale of credibility.

Meanwhile, business magazines and analyst reports have widened their lead over TV, radio and newspapers as the most trusted sources of information about companies over the past few years. Corporate advertising is the lowest at 14%.

Well that’s no surprise either. But I’ve never trusted much what people say about the media. That’s not least because messengers often get confused with the message – and shot as a result. But the truth is the mass media matters as much as ever, and still sets agendas internationally.

Social media is all very interesting but it mostly feeds off the commercial media. Moreover, there has been a long-term decline in newspaper readership in the West and in the fashion of things magazines are filling much of the gap that that left.

Yes, I’ve never liked corporate advertising, particularly when its greenwash BP-style with slogans such as beyond petroleum.

There remains great skepticism about future behavior of business, with almost 70% expecting “a return to business as usual” by companies and financial institutions once the crisis is over. Two-thirds of respondents expect government to have active influence over the financial sector. More than 70% said reducing the gap between senior executive and ordinary employee pay and firing underperforming management was central to restoring trust in companies.

Linking pay and bonuses to performance makes sense, but that could result in even larger remunerations than during the last boom once things start booming again.

In conclusion, I ask is trust really, as Richard Edelman claims “an essential line of business to be developed and delivered,” or is it, as I maintain, something which flows from innovation, performance and delivery on promises? Is the heart of trust setting expectations and meeting them? I think so.

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Investors can’t have it both ways. Given the contradictory responses, the one we should trust is the one respondents invest in. Lots of people seem to have resisted a “flight to safety”. What we seem to have is a generalised sense that one ought to feel at risk and say one has lost trust, whilst operationally one goes on trusting and taking risks with roughly whatever appetite one had in the first place.

But the public is not merely contradictory. It is nonsensical (or the FT’s questions were). What, after all, is someone saying when they insist they trust themselves to look after their savings? That they would rather keep the loot under the bed? Or are they saying that they trust their own advice more than anyone else’s? Wot, and not read the FT? Renounce unit trusts and pension funds (both of which make choices about where to put their client’s money)?

Most investors, said the FT, did not think they were adequately protected by the state (another surprise given how the state has backed the banks). But, reassuringly, the FT reports that it is not only savers who are sticking with the status quo:

“…. a majority of respondents in all European countries and the US have not changed the amount of risk in their portfolios, three in 10 Americans, one in four French and Germans and one in five Italians and Britons said they were now taking less risk. In Spain, three in 10 have reported that they were willing to take more risk.”

It seems, also, that most people in Britain, Germany and France have not altered their attitudes towards investing in the stock market compared with two years ago. So while some have reduced their risk, most have not, and some are already ready to up their risk levels.

The FT results reveal – if you can reveal the obvious – that the public has lost confidence in individual risk assessments and in the reputations that were once built upon sound risk management (trust and keeping promises used to be at the heart of City-type values). But what does this mean? That an institution can be less trustworthy but just as worth investing in?

So how can the PR high ground be seized without resorting to talking populist nonsense?

The best way to face the challenge is for banks and institutions to take the defence of their reputations in to their own hands (there’s a useful call to action in PR Week by Anthony Hilton: Bankers Still Live In PR-free Zone).

Moreover, if firms want to avoid the worst forms of regulation then they have to promote self-regulation as well as openness. My colleague Richard D North puts on it on a sister sister site – here and here - like this:

Instead of writing lots of rules which must be obeyed, the best regulators would name and shame firms and sectors which had not produced the sorts of voluntary schemes which offered appropriate (always optimum, not always maximum) safety. Those warnings would then reinforce the market’s tendency to produce satisfactory safety. The firms and sectors which were exposed would see custom drying up or stakeholders demand premiums.

That would really be a return to the values of “a man’s word is his bond”.

By the way, those wanting to read my more detailed account of the future of financial PR in the new era can read it here.

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Let’s start at the beginning. Since the ancient Greeks perfected rhetoric, persuaders have used every trick in the book. And since then, too, the debate has raged about whether such techniques constituted an artform-cum-science as claimed by Aristotle, or whether they constituted no more than flattery as Plato maintained. And, perhaps, Machiavelli’s The Prince was the first psychological-PR handbook for despotic rulers (I’ve not read enough to know if that’s true or not). Edward Bernays seems sensibly to state:

Although ancient Sumeria, Babylonia, Assyria, and Persia were despotic monarchies, public opinion played some role in the national life. The governments of those ancient empires spent a great deal of money and ingenuity in building up the reputation and importance of the rulers.
(Edward L Bernays, Public Relations, University of Oklahoma Press, 1952)

But Bernays also offers a more profound insight:

The three main elements of public relations are practically as old as society: informing people, persuading people, or integrating people with people [stakeholder relationship management hadn't been coined back then]. Of course, the means and methods of accomplishing these ends have changed as society has changed. In a technologically advanced society, like that of today, ideas are communicated by newspaper, magazine, film, radio, television, and other means….. Modern individual psychology and social psychology provide the basis for persuasion, a symbol of pluralism and fluidity.
(Ibid.)

So for Bernays – and for his uncle Freud upon whose thinking he relied – human nature and human social psychology were not fixed, not hard-wired. They were in important measure social constructs, capable of study and manipulation, and indeed so because not – as it were – ingrained. For instance, Gustave LeBon, the originator of Crowd psychology, made a useful contribution to modern PR theory. But the crowds that formed his subject were part of urbanized life. His crowd was a modern phenomenon driven by the end of rural (isolated non-crowd) life and the emergence of modern networks of communication and industry. I make this point in defence of my heroes such as Bernays, Carnegie, Freud, Levitt, Lippmann and Maslow. They all popularized the use of social science theory in our trade.

There has, however, always been a darker side to this issue. It has covered everything from racism (slavery/apartheid), anti-semitism (fascism) or phrenology (the theory stating that the personality traits of a person can be derived from the shape of the skull). These all relied on the view that there is a fixity in human beings and human relations. 

The history of these mechanistic accounts of human life makes me nervous of modern explanations of human behaviour based on neuroscience or evolutionary biology. (Though I accept that mental illness is something different and often has a neurological origin.)

Moreover, some commentators have also rightly pointed out that all PR techniques are value-neutral and are open for use for both good and bad purposes.

For a contemporary in-depth discussion of neuroscience’s possible wider social implications, I recommend this book review by a peer of Chris Frith’s Making up the Mind: How the Brain Creates our Mental World.

Whichever side of the expert argument – the reviewer’s or Firth’s – you take, it offers little support to the notion that neuro-PR is possible today. For the record, my Enlightenment and post-modernist-tinged views, which inform my PR practice, are instinctively hostile to Firth’s belief that free will is just a manufactured state of mind. Firth’s point, however, should not be confused with Bernays’ concept of manufacturing consent just because the words and meaning sound similar (I’ll defend Bernays in another article soon).

What interests me here is why there is renewed interest in the benefits that neuroscience could bring to our industry. Toni Muzi Falconi explains it thus:

I refer to what many researchers and practitioners are beginning to realize: opinions are much less correlated to behaviours than they used to be only ten, fifteen years ago.

If this is even only partially true, it means that we (as well as the market, political and social research industry) need to focus our attention much more on understanding behaviours than opinions.

And this certainly raises the necessity that we revise our listening processes through a much better knowledge of both psychology and neuroscience.

What people say they think, and what they do (or how they vote in secret), often seem dramatically out of sync. That’s not new. Hypocrisy is not new. (It’s true that mass cynicism is a very modern trait, but even so, in Soviet Russia it was for many years a national mass underground sport.) Few people – as Bernays knew all too well – have thought in depth about their world view. It is, then, no wonder most opinion research highlights shifting, confused responses even when the opinions given seem to be most emphatic. A good dose of commonsense could very easily square the contradiction between the opinions given to researchers and people’s actual behaviour in the real world. 

And here comes my counter-intuiative punch. I think that the insights of science aren’t especially powerful or sinister when it comes to determining PR outcomes or even influencing opinion. I don’t think that either PR or, indeed, propaganda can be held responsible – even if they played a part – for Stalinism, the Nazis, or Apartheid South Africa; if only it were that simple.

One might as well use all the insights one can: scientific or not. They’re not likely to be more sinister or stronger than ordinary commonsense or wiliness, or more influential than the many other factors – say, chance, culture, economics, geography, history, personalities and politics – that determine outcomes in society.

Hence, I’m not advocating closing down discussion about neuro-PR or any other form of PR or discarding any scientific tools that might prove useful. But I don’t think neuroscience will be influencing anybody’s PR practice and line of argument any time soon.

By the way, Heather Yaxley did us all - me, certainly - a great service in her excellent blog post on this theme.

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First, I’ll risk summarising Richard Edelman’s take on the survey’s findings as reported by the FT:

(1) Trust in government and business used to be inverse, now they’re less so.
(2) The public trust firms which focus on good products and happy employees rather than merely on shareholder value.
(3) Firms need to talk more about their value to society (not merely) shareholders, and they (firms) don’t like that.

But (and more to my taste) the survey also says that the market is believed to be as likely to contribute to a return to growth as business or government are. And trust in business is back, though trust in government is back even more.

Edelman’s know I am friendly and admiring critic of their surveys, and the following remarks are in that vein.

On (1), it would be a bit surprising if people weren’t a bit wobbly about business in 2008 and a bit less wobbly now. And presumably they feel they can trust business more because they have learned that they can trust government to do its best to fix business’ problems (especially if it poses systemic risk). It isn’t a surprise that people enjoy wondering whether they trust business or government more, but of course business and government are mutually dependent. That was always so, even if the balance between the two shifts as circumstances do. Moreover, different societies frame that relationship differently (in some, tension is regarded as productive, in others, symbiosis is.)

On (2), isn’t this the same thing as saying that people now trust firms that they believe are trustworthy: ie, likely to be building long term value without social controversy rather than going in for spivvy short termism? It doesn’t surprise me that people are looking for wider signs of trustworthiness granted that share prices have proved an unreliable indicator.

On (3), firms may indeed need to talk about their resilience and sustainability; that is, their commitment to long-term shareholder value. But that rather contradicts Richard Edelman’s downgrading of shareholder value’s importance (or reframes it). Long term business sustainability is probably a good proxy for social value and approximates to the kind of social value a firm can actually think and act – talk – about usefully. This will only apply to some firms. (Not, for instance, to a firm designed to produce one film and then disband.)

We should also look beneath the surface at the relationship between trust government and business in places like China, a one-party dictatorship, and the UK, a Western democracy.

I fear that Edelman make two opposite mistakes. On the one hand, they sometimes take too much of the opinions they record at face value. Not least when they diss trust in the media, which I have long-argued is a popular sport that people don’t take seriously. The media remain the main vehicle for formulating a picture of the wider world precesely because it is more trusted than not. On the other hand, Edelman believe business need to engage more and more widely with society, and beyond commonplace business criteria (such as shareholder value). For me, this forces firms into talking nonsense. I’d rather firms framed their commercial objectives as clearly as they can, including a desire to thrive in the long term (if they do).

So, a superficial reading of Edelman’s interesting data may tempt firms and PRs into poor strategies and tactics. Meanwhile, here’s some links worth following here & here & here & here.

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