PRs representing bankers need not concede much ground to the moralists. Instead they should recommend their clients come out fighting. The advice from financial PRs should be: stand your ground; defend yourselves; get the rest of the business community behind you.

If banking clients have doubts about the merits of this approach, PRs should remind them that so far they have been very bad at making a serious case for themselves, which has made it hard for PRs to do so on their behalf. Moreover, bankers need not worry about going out on a limb. There are positive signs that the British business establishment is more than prepared to back British bankers and to condemn the anti-business rhetoric being spouted by the media, protesters and politicians.

This week a leading group of business folk, including Sir Michael Rake, chairman of BT and Easyjet, Sir Andrew Witty, chief executive of Glaxo Smith Kline, and Paul Walsh, chief executive of Diageo, will tell Prime Minister David Cameron to stop bullying CEOs. According to The Sunday Times, one of them will state that if Cameron’s government keeps bashing business:

Eventually companies will leave, and those that stay will not be able to recruit top talent.

That’s the bottom line. The British Establishment’s liberal courtiers are in danger of making the country Mickey Mouse about all this: scapegoating Fred Goodwin, whinging about rather ordinary pay and bonuses for HSBC, Barclays and other bankers.

Hence bankers should tell politicians and the media that the British people and City of London need thriving financial institutions more than they need them. That’s an arrogant message, perhaps. But it has the compelling merit of being an honest one.

PRs have to say forcibly that we need Hester to stay at RBS, and we need HSBC and Barclays to look like credible global businesses capable of attracting the very best to work for them: end of. The rest is noise.

It is unlikely that the public and media can be persuaded to agree with such messaging right now. Yet I doubt that the masses will be pleased over the long term if the liberal commentariats make the moral hazards of doing business in Britain too much for the banking sector to bear. So David Cameron (who can be convinced and needs convincing now) needs to be told that he won’t gain anything by banker-bashing. That pious positioning should be left to Ed Miliband, who is blindly stuffing his portfolio with this unelectable puff.

As several people have remarked, the public will be slightly more in favour of bankers etc. when in a few years’ time, Britain is the world centre of world class bankers. But if we lose this fight to the other side because Britain does not embrace banks and business, Switzerland, where I live, is one of many countries that hopes to profit from the UK’s demise.

Swiss bankers have never been popular in Switzerland. Instead, the Swiss grasp the truth about who needs whom more and why. They have long-acknowledged, however reluctantly at times, what drives business success. They value the benefits that accrue to the wider population as a consequence of allowing their financial institutions to function properly in a global market place.

So as I close this piece, here’s my insight gained from observing Swiss bankers. Bankers need to be trusted more than they need to be popular. To win trust they need to speak straight about the realities of their business. That won’t make them popular. BUT: there’s never been an era in history when bankers and money lenders have been popular. So get used to it; get over it.

Canny PRs have long seen this stuff clearly. To those that don’t yet get it, I say be careful which side you support because the stakes are very high indeed.

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Roman represents the future of our trade. His quality of thought is becoming more common – though far from common enough – across the in-house and agency world.

Roman Geiser

He embodies how PR is maturing as a business under a new generation’s leadership as it enters its Golden Age.

His take on things ranges from radical ideas for repositioning Swiss banks, to questioning the effectiveness of the S in CSR.  He’s prepared to think big about what disintermediation could do for his clients, while staying alert to the possible downsides for society as a whole. He is cleverly nuanced about social media (a tad over-enthusiastic for my taste, but there you go).

He joined the agency world seven years ago. His background was as a public affairs lobbyist for an umbrella organisation of Swiss businesses. Then he was hired by Jäggi Burson-Marsteller, a formerly family-owned business based in Zurich and Bern, which was bought by BM, Young & Rubicam.

So, as he readied himself for his journey as a PR agency EMEA COO, I asked him to give us an insight in to his business and thinking. Here’s the outcome:

Strategy, evidence and today’s market

PS: I’d like you to describe what the recession has done to your clients, to explain how well your business in EMEA has fared.

RG:  It really depends market by market and positioning by positioning of each unit we have in our organisation. In Switzerland, we work for industries such as energy, pharmaceuticals and food.  If you take those three industries, they’re doing pretty well in the recession.

We see a clear trend to specialisation and focus.  The mid-sized agencies in this market – those offering 360 degree service – have an issue. Clients either want an agency that really understands their business, or an agency with functional or specialist expertise, for instance agencies that are 100% specialised in digital media and social media.  So there is a need for all agencies to find a sweet spot.

We see a certain cautiousness. There’s a psychological impact on even healthy businesses. Investments are taken more slowly than before.

Some services have become commoditised.  However the more strategically an agency is positioned the better it is protected from the crisis.  So offering product PR in the fast moving consumer goods area, for example, has become a low margin business.  Or even doing financial communications around standard transactions like public offerings has become internalised by banks and commoditised.

That means the higher up the value chain you are, and the better the quality of service you offer, the better off you are during the crisis.  Services like doing press releases, or just media relations in multi markets – those are not services where you can differentiate your brand. They are really price-based discussions which put your margins under pressure.

Burson-Marsteller is known in the industry as being extremely strategic. Of course, all agencies claim that!

PS: What exactly does ‘strategic’ mean?

GS:  If I take the Swiss example, we are very successful in healthcare.  We have a team of scientists here.  We have four medical doctors and a professor at Rockefeller University.  You need that kind of calibre to really bring evidence to the table to provide analysis. Then you can have a discussion with the client based on “This is the existing mindset and this how we get to where we want to go”. For me, that insight and knowledge and in-depth analysis based on qualitative and quantitative research is evidence-based.  And it starts at the beginning of a project.

Froth on the boom’s coffee or the caffeine in the latte?

PS: Do you agree with me that PR was guilty of putting the froth on the late boom’s coffee? Or put another way, if bankers have had to say sorry, do we need to, too?

RG: I understand where you’re coming from. One of the key reasons to have a PR agency, or a trusted advisor, is to bring critical faculty to the table and to ask the right questions. And, for sure, in certain industries the PR industry profited from the hype and we were part of the overall economic system.  At the same time, I believe there were great attempts to warn and also to support CEOs in their function.

PS: To warn?

RG: Yes to warn. You like to quote Dr Leslie Gaines-Ross on your blog. She recently highlighted how the trend from celebrity CEO to credibility CEO, more of “please show me” and not just the glamour stuff, began some four or five years ago. And that’s a kind of clear anti-hype warning that came from the PR industry itself.

Burson-Marsteller tried to engage the Swiss Bankers Association, for instance, in some pre-emptive reputational research during the boom. But what do you do when a decision-maker tells me “Thanks for your advice but we don’t have an issue”? That’s why I feel we did our job properly.

What kind of capitalism comes next?

PS: Will the new boom produce a different capitalism, particularly considering that the world’s most dynamic economies are going to be amongst its least democratic?

RG: I don’t think that there will be new models to capitalism.  I mean, it’s a pretty well established domain, right? There will be a new global balance of economies being at the table as equals with with the US in some fields.  That, I believe, is certainly more than a trend.

PS: Is there a new morality to capitalism?

RG: First, capitalism is not anti-moral. Second it’s been in practice for decades. So it won’t have a new shape or new dimensions in future.

I wouldn’t jump to saying: “Here is the new global regime with new power bases”. For instance, I still see the US, just by its historic capability for revitalisation, reinvention and innovation, as a strong leader and player in the future.  But it’s interesting to see that the most recent growth and first signals for recovery came clearly from China, also from India, but basically from China, which is new.

We shouldn’t underestimate the power of the old economies. In a world which is getting much more complex, with multi-stakeholder management, with so many stakeholder groups having an impact on your business, that calls for managing complexity.  And if you look at the continent which really has experience of managing complexity from language to cultures, it is Europe.

Where is PR headed?

PS: What are the three major three trends that will dominate the PR landscape over the next ten years?

RG: The key trend definitely is social media and digital communications and the shift of paradigm from mass media into more dialogue-oriented communications. That’s a huge shift. But its impact varies from market to market, culture to culture. For instance, Switzerland is highly digitalised, but it also values privacy. People don’t speak up on blogs here, as they do in the UK, and give their opinions.

Second, I would say, is the balance of purpose and performance in an organisation in order to build trust longer term.  It’s basically the question of: “What is the purpose of a corporate, of a multi-national?”.  It’s very often around employees.  It’s around the products and the services for consumers.  So it’s around the mission and vision of a company

The third trend is multi-stakeholder transparency in a globalised world.  Companies operating around the globe need to demonstrate transparency and to explain themselves to many more stakeholders in the age of trend No. 1.

It’s not about structures but about leadership

PS: How will PR agencies change their business models and services?

RG: The first one sounds easy, but it’s extremely complex to make digital communication more than an add-on to your communications programmes. Very often you say “What could we do digitally?  Do we do a website? And yes, there are new trends like Twitter.  We need to offer that in our communications programme”.  And that’s the wrong attitude.  I believe digital or kind of low-cost media needs to become an integrated part of all communication concepts.

At the same time, you need to understand your business extremely well to see the limits of digital social media, such as in pharmaceuticals for obvious regulatory reasons.  Going into it with a kind of hype attitude can be dangerous. It’s new, but it’s more than just a fad. But it’s not a revolution. It’s an evolution. It’s an evolution which brings the business more into the dialogue-oriented sectors of communications.

The multi-stakeholder global trend goes into new agency models, which I believe are going to be more international.  PR agencies are still coming out of the first phase of family-owned businesses with very local business models.  But we are becoming more digital and more international.  Offering that service to your client becomes more and more important.

Of course, managing the matrix of markets and practices in agencies is extremely demanding. It needs people who like to work together. And it starts at the top.  So if you have a management team or market leaders who like each other and work together well, you have the key ingredients for not working in silos any more.  So there is no real ideal structural model. You can have all kind of bonus systems and financial incentives. But what is really needed is investment in a team that works together collaboratively and which produces success stories together. That’s the way to go.

What are reputations made of? A five point list

PS: How would you explain the success of Apple and Ryanair’s PR, both of which, for different reasons and in different ways, seem to do everything wrong, and yet seem to get everything right in terms of their reputation and business strategy?

RG: My explanation would be that it is always multi-dimensional. Let me list the top five elements that create great reputations for firms.

First, is how they develop talent and how attractive are they for potential employees.  Take Apple.  They are doing that extremely successfully.

Second is product and services of high quality.  You can be as digital as you want.  You can be as corporate responsible as you want.  If you don’t get your product right, if you have a problem explaining your hedge fund to your target group because you don’t understand it yourself, you might ask yourself the question, “Is my product really a good product”.  In the case of Apple or Ryanair, they have solid services, good products, which fit into very specific target groups.

Third, transparent leadership structures.

The fourth is financial results and performance. If you drive a business which is financially sound, you create the momentum for a sound reputation. And that brings me to number five.

The last one on my list would be CEO reputation.  And here again both Ryanair and Apple score through the roof on that one.

It is the balance between these five factors creates a good reputation and trust. You do not need to be top on all five. But it’s always a dimension of those aspects.  And other reputation studies maybe have a different ranking. But it’s those that I’ve listed which are the key drivers that count.

Time to ditch the S in CSR? And what is CR about?

PS: Is CSR a marketing tool or a genuine attempt to inject morality into capitalism?

RG: This really comes under my “purpose and performance” answer. Let me explain. I prioritise the  concept of responsibility rather than the social bit of it. That’s because “social” is corporate giving and sponsoring. But corporate responsibility goes to supply chain management and to diversity in the workplace. It goes to labour standards in all kinds of countries. It goes to compliance issues, too.

If you take corporate responsibility or give that angle to CR as a communication platform, we are talking evidence-based communication. We are talking about content and not just about how you brand it or how you position it and how you make a better marketing tool out of it. It is really about how you run your business and how you act responsibly in the roles in which you operate.

Elevator pitch to put Swiss banking back on track

PS: Good to hear. I’ve always advocated dropping the S in CSR and also for promoting business sustainability much more forcibly than we currently do.

Now, moving on. Please pick an unpopular person, institution, firm or country and make an “elevator pitch” for it.

RG: I’d pitch the financial sector in Switzerland.  And what I’d be pitching would have nothing to do with communications.

PS: Okay, go ahead.

RG:  Behaviour drives communications and reputations. It’s all driven by behaviour.  And the first behaviour recommendation I’d make to the Swiss banks would be not to base a product or the financial sector on a system of differentiation of tax evasion and tax fraud.

The only differentiation that matters is excellence in Swiss banking. There are huge assets which come with excellent banking and the positioning of it. So Swiss banks should not hide behind a smart legal differentiation of evasion and fraud. That’s not the way to go.

Second, nobody likes secrets.  We do like privacy, though.  Why is Swiss banking branded “banking secrecy”?  It’s the protection of the individual and the protection of one’s privacy that matters. And that is a different concept.

My third point would be look at self-regulation. I say don’t wait until the regulators push their positions on you.  Self-regulation can be a very healthy way to come out of the crisis stronger and to keep enough room for your core business.

My fourth is look at the products, because the banking products have become too complicated. There are many ways to shape products in more understandable ways. After all, good products, as we discussed earlier, are one of the key drivers of reputations. Products need to be much more transparent. Any risks in those products require a clear assessment of the portfolio. Sometimes in the boom years, the underlying risks were not clear even to specialists working in the field.

Power shifts in media – good news and not so good news

PS:  Ask yourself the question I should have asked you.

RG: A point you haven’t mentioned is the role of old media, if you want. There is right now a power shift of who produces relevant content and who has the power to invest in content?  And that shift goes from media to the PR sector.  It goes to in-house PR, external PR. And as a PR man, I could say it’s a great strength. But as somebody who is socially or politically aware, I would say it can do harm to the balance of democracy, because media have an important role there.  And sizing down all those newspapers, and taking away their ability power to do in-depth research is a problem.

At the same time you have big companies, PR firms basically involved in paid-content production.  It doesn’t mean that the content is not correct, but it always presents one perspective in a discussion and I believe there still needs to be strong media to play a role in public debates.

Certainly, big corporate can become the media. Why not have Nike TV doing sports programmes? But I like the “competition of ideas”. If you want to have a competition you need a few players being part of that competition.

PS: Do you have any closing remarks?

RG: Yes. If you ask our founder Harold Burson what makes a great PR person he says “curiosity”. And I think it is fascinating right now to be a PR person. There are so many things going on. We are challenged more than ever before. There’s loads of opportunity. I think we can say it is a new age, as you say, a golden one.

PS: Thanks. Great stuff, if I may say so.

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PR firm Cohn & Wolfe director Ros Hunt writes that, “a successful response to a crisis situation starts with the senior executives and flows through the workforce directly to consumers.” Hunt says that too few senior financial executives have been explaining their role in events. I agree. Except that I would make a few honourable exceptions. John Varley of Barclays and Michael Coogan at the Council of Mortgage Lenders have been excellent. Moreover, Stephen Green of HSBC deserves praise for his upfront comments at Davos.

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The BBA communication team seem to think they are in the audience. Why aren’t they on the stage directing their own drama?

It is clear that the banks are getting a bad media rap. It might also be true that journalists do not understand the credit crunch and the recession well. However none of that justifies the BBA’s moan.

There’s been a chronic shortage of banking spokespeople lining up to tell us what’s been going on.

The notable exception being John Varley of independently-minded Barclays. That one is also a hard sell. The Times reports confidence and trust are at such a low-ebb that Barclays’ £5.3 billion or more expected profit has not improved perception:

As a public relations brief, it is the financial equivalent of defending vivisection or the transportation of nuclear waste through a pretty village: you think your case is solid and justifiable, but no matter how hard you argue it, nobody wants to listen.

We certainly don’t need lots of PR spokespeople speaking up as much as lots of senior people explaining themselves. But Lesley McLeod tells PR Week:

The story has moved away from financial journalists either because newspapers do not have the staff any longer or because it is dealt with on the news pages. Clearly some of these journalists do not have an understanding of the issues.

A lot of these people are now either inexperienced or they’re taking [information] directly from PA.

According to McLeod, the Treasury PR machine is more interested in communicating political messages than the financial intricacies to the media. So what’s new? Their first loyalty is to their political bosses. Neither that fact nor media “illiteracy” about banking issues should surprise.

In the early 1990s as head of media relations at the Council of Mortgage Lenders I saw for myself how bad news gets politicised fast. It is an old challenge listed on every well-rehearsed crisis management plan.

The problems the banks face are of wider importance to the firms PRs represent. There is a pressing need to develop PR strategies for this recession and the recovery that will follow. At stake is the restoration of trust in financial institutions and much more.

The way forward is for PR machines to take responsibility for communicating their messages to audiences.

The swift disintermediation of traditional media institutions creates opportunities for PRs to create their own media. For instance, if the media are so bad, where was the brilliant bankers’ website(s) daily pumping out the good stuff so readers could go to the horse’s mouth without the intermediation of the useless press (if that’s what it is)?

Today’s bankers can create their own Web-based media machine easily and cheaply – print, TV, radio, interactive and direct. There are numerous platforms to exploit from YouTube and Facebook to Twitter; and a thousand others that the banks can invent. They are not reliant on traditional media to get across their point.

New media or Next Media – as Charlie Beckett of POLIS calls it – allows them to communicate proactively over the heads of or alongside traditional media. In that sense Obama shows the way forward. He has created online network ready to mobilise. He uses his network to interact with and influence the mainstream media agenda.

Don’t get this wrong. “Old” media are not redundant and “new” media triumphant. It is not that simple. There are no substitutes. More it acknowledges that there is a new way to cement bonds with stakeholders. Effective communication today requires a more public participatory and connected process, with journalists no longer being gatekeepers, but facilitators, and news being more of a process, or service.

Banks are walking a tightrope. They have savers, borrowers, shareholders and taxpayers to consider. The forces at work are contradictory, and often their interests are irreconcilable. It is no wonder, then, that the media have lots of conflict to report and different interest groups’ gripes, fears and worries to portray.

The banks, on the other hand, have unique insight. They should be explaining the banking crisis, nationalisation…credit crunch…extent of liabilities such as toxic mortgage debt, and promoting the solutions for rebooting the system. Banks and their PRs have to make plain how things really are. Moaning will not do.

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He apologised properly, shouldering responsibility for his industry’s role in creating the recession. He was realistic about the future. He set absolutely the right tone and communicated some tough messages.

Asked by Sky TV’s Jeff Randall (see the video below) whether he agreed with Nobel Peace Prize winner Paul Krugman that the financial collapse seems certain to turn a run of the mill recession into something much worse, Varley replied:

Oh, yes, there’s no doubt about that. If you look at the players who were involved in what’s happened to the world, I think there were quite a lot of players involved. They would include central banks, they would include governments. But they would certainly include the banks. And the banks have to be prepared to have the humility to acknowledge that and accept it, and to say sorry. It is important that the industry is in that space. Partly because they need to take their share of their responsibility; we need to take our share of the responsibility as an industry. And partly also because banks need to be at the table when the reconstruction and the remediation is discussed and agreed.

On the Today programme (listen again on their BBC website page for 20 December, 2008) Varley forthrightly admitted that some of this is a PR matter. The banks need to rebuild their reputations. He seemed effortlessly to understand this was a moment when messages matter. It may be that Varley is in especially good shape to speak both humbly and robustly because he hasn’t yet taken the tax-payer’s shilling. So he accepts some of the blame for this mess but is in the relatively attractive position of wanting to dig himself out of the hole by himself.

A PR professional is bound to ask whether Varley was tutored in his messaging and its style, or is a natural. Who cares? He got there. No-one else at his level, or anywhere near it, has been as good, or anywhere near it.

It is worth reprising some of his messages:

• Last ten years were an anomaly rather than normalcy.
• Explosion in price of assets as a result of the easy availability of money.
• Loan to value ratios in British houses, available at 100%, 115% or 125% of the value of a house: “looking back on it, madness”.
• Unemployment rising to 7.5% of the course of the next 12 months, with unemployment in the UK reaching 2.5 million by the end of 2009.
• Negative house price inflation, still has another 10% to 15% between now and the end of next year.
• Many customers struggling with the slowdown in the economy, and our obligation is to be as supportive as we can.
• Barclays and the big banks are open for business.

How can the answer be yet more cheap debt, lower interest rates, surely that cannot be the solution?

What the economies around the world need is a burst of stimulus. It is perfectly clear to me that within that package there needs to be, and there are now, lower interest rates. For millions of our customers as a result of the cut in base rate; millions of our mortgage customers, millions of small and medium-sized enterprise customers are now getting the benefit of lower monthly debt service costs. That is, I think, a good thing as they struggle through the economic slowdown of the next 12 months or so. But if you ask me should we have perennially low interest rates, absolutely not.

I think you could say that one of the big drivers of this crisis has been easy money made available by central banks around the world over the course of the last seven years. It has absolutely been a catalyst of the crisis. So I accept that point. Getting the balance right is not easy. But that’s what – frankly – governments, and central banks, and indeed commercial banks like this bank have to get right.

Commenting on his bank’s struggle to maintain his bank’s independence he says:

• From the point of view of shareholders there is a significant advantage to independence.
• If British taxpayers’ money is deployed in a bank a big part of the agenda of that bank has to be directed at the UK.
• But Barclays is more than a UK bank – it employs more people outside the UK and has more customers outside the UK.
• It is important that growth outside of the UK is unimpaired.
• What you want is alignment between your shareholders. The commercial interests of shareholders need to be aligned.
• There is a significant difference – candidly, in the context of alignment – between taking UK government money, which has to carry some social agenda with it.
• Compare that with the commercial interests of the sovereign wealth funds who have invested in Barclays. There is complete alignment between the interests of those sovereign funds and the interests of our institutional and personal shareholders.

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Not at all. He’d sent out a letter to all the bank’s depositors. It starts out saying that many of us have been unnerved by the mess the bank finds itself in and goes on:

We understand your concerns and admit that we, too, have made mistakes.

Hang on a minute, when Kurer says “we, too”, he implies we, his customers, made mistakes that helped create the bank’s mess; or at a stretch the customers made mistakes investing with UBS in the first place. Maybe he meant, but failed miserably to say: “we like other banks made mistakes”.

OK, OK, I know. English is a foreign language at UBS. Still, UBS is a global bank and anyway English is the global language of business.

To be fair, my wife’s version of the same letter in German does not blame UBS’s customers for having made mistakes along with the bank, or whatever. It just admits the bank made mistakes. So it was just English-speaking customers the bank insulted, if anyone. I’m assuming it was a momentary slip, a cack-handed small blunder.

Never mind. It’s not a bad letter. The important thing is that the bank says:

We apologize for not always having been able to fulfill your expectations during this difficult time. Which is why your loyalty is all the more important to us – and is something we by no means take for granted.

….we do not have any immediate influence on how things develop. There are no doubt further challenges ahead. We will still have to confront the occasional setback and make difficult decisions.

Actually, if you want to get picky, I’m not sure I am very worried about the bank’s behaviour in the present “difficult times”. I’m hacked off by their behaviour during the “boom” times when a bit of caution would have helped.

Let’s stick with the seasonal good cheer. This letter goes some way to showing that UBS are not a complacent bunch of Swiss bankers. They have apologised to their customers for their mistakes. They have done so in a letter signed by UBS’s three most senior executives. Even customers with no money in their accounts received it. They have warned us in writing to expect more surprises in the future.

Switzerland’s crisp chill winter air refreshes the spirit. It melts the heart; even if it freezes other parts. So I’m full of Swiss bonhomie. I’m inspired by my neighbours clearing their own street at 7 AM with shovels in the freezing cold while the snow fell. The young helped the old. Smiles and jokes were shared. I’m in a forgiving mood.

Peter Kurer’s letter is exactly what the reputation doctors called for to restore trust. There’s a long way to go. Meanwhile, I’m confident money invested at UBS is safe as it can be with any bank right now and that UBS executives are fighting the good fight in defence of their reputation.

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We WSJ writers must stick together. But there’s more than collegiate fellow-feeling in my support for Ms Fiorina’s opinion-piece in the Journal. She’s right.

At first I thought I ought to declare an interest. During the turbulent Compaq HP merger, I was seconded by Weber Shandwick to troubleshoot at Compaq for the CEO and Executive Chairman of EMEA, as their speechwriter, financial communication and PR adviser. I stayed on after the merger. Maybe that makes me sympathetic to her view.

Then I remembered that my having made her case as a professional did not mean that I necessarily thought then or think now she’s a brilliant commentator.

So no. It comes down to the simple fact that I think she’s on the money here.

She sets out some practical things big business can do to improve its practice and image:

• Strengthen accountability: boards should put all aspects of CEO pay up for shareholder vote on an annual basis.  (UBS here)

• Make clawback provisions, which require a CEO to return compensation to shareholders if promised results aren’t delivered following their departure.  (UBS here and here)

• Base CEO pay on a balanced scorecard that reflects customer satisfaction and investment in employees, in addition to achievement of financial goals.

• Every board seat should be voted on annually and board membership should be regularly refreshed to ensure that tough questions continue to be asked. (Barclays)

• When CEOs go to Washington and ask for taxpayer money, they should also be prepared to submit their resignations and those of their boards. (Dexia in Belgium here)

• To earn a bailout, a CEO and board should be held accountable for the decisions they’ve made – or perhaps the actions they’ve failed to take. (Ford and General Motors here)

• To strengthen transparency, companies should provide far more than quarterly earnings projections and annual profit targets.

• Important strategic issues and operational considerations should be reported consistently.

• Risks and assumptions should be spelled out rather than buried in the fine print. Employees bet on a company when they show up at work.

• Shareholders bet when they put their money to work. Customers bet when they buy a product. And now we’re asking taxpayers to bet. It’s reasonable that we all know what the company is betting on. (mortgage lenders here and here).

I sense that there is a consensus coming on, or at least clear thinking that will forge one.  Moreover, Carly’s (excuse the familiarty, but I sort of worked for her once) advocacy of the importance of business’s independence from the state should serve as a rallying call:

There is no doubt that government will now play a greater role in key industries. While this expanded role is perhaps vital for a time, our Founding Fathers knew that government’s power should be limited. If we are to emerge stronger from our current crises, businesses must restore their credibility and regain the American people’s trust by embracing accountability and transparency.

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The Council of Mortgage Lenders (CML) has made public how mortgage lenders are caught in a tug of war. It has exposed how the government has asked mortgage lenders to set “conflicting and incoherent” priorities. Michael Coogan, director general of the CML, pointed out yesterday:

“To different degrees lenders are facing conflicting pressures to recapitalise against possible future losses, service government’s preference shareholdings at 12 per cent, pay a premium to access the Bank of England Special Liquidity Scheme, show forbearance to borrowers in arrears, follow base rate moves down to help their existing borrowers, keep savings rates high to support existing savers, and provide competitive rates to new borrowers and savers to maintain economic activity in a recession.

The truth is that there are no easy answers. There are only tough choices; something that the British Bankers’ Association has also uefully made clear.

Any impression that mortgage lenders or banks can please all their stakeholders equally is highy misleading and sets false expectations. It is good to see that honesty and directness is being favoured over fudge and nonesense, which were causes of cynicism and lack of trust in the first place.

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Last week I had coffee with a PR executive who helped manage Thursday’s UBS shareholders’ meeting in Lucerne. We met at Sprüngli on the Paradeplatz, the branch of the posh chocolate, cake and coffee shop favoured by wives of Zurich gnomes. He gave me an insider’s account of his work to restore trust in the Swiss icon.

He said the bank’s strategy was to rebuild trust in its competence piece by piece, issue by issue. He described how UBS was managing a series of crises ranging from toxic debt, excessive executive bonuses, plunging share price and accusations of facilitating tax evasion and abusing banking secrecy rules in the US.

This was the fourth shareholders’ meeting of 2008. Besides ratifying a government bailout, he told me how Thursday’s meeting was about communicating that UBS’s culture is changing. It was about saying sorry again, and trashing the image of arrogance. It was also about reassuring stakeholders that investments in UBS were safe and about setting out the new course for the bank.

He stated that UBS was developing a formula for managing executive bonuses that the rest of the banking industry was sure to emulate. UBS chairman Peter Kurer certainly tackled the controversial bonus question head-on. He renounced his own bonus entitlement this year and announced:

We want to give shareholders a greater say in decisions on compensation. Starting with the general meeting in 2009, we will make our decisions on the principles and guidelines for compensation within the framework of a consultative vote.

This time around the sceptical audience was more subdued than at the other shareholder meetings. News that former UBS chairman Marcel Ospel and two colleagues had renounced their right to collect CHF33 million in bonus won some applause. But chairman Peter Kurer’s enthusiasm to clawback the bonuses of others won still more. However most of Peter Kurer’s speech was heard in silence.

My friend explained that on some issues the bank will just have to take the blows. For instance, when Peter Kurer praised board member Rainer-Marc Frey for his contribution to the bank, there were whistles of derision – this being the man who sold all his UBS shares before the worst of the you-know-what hit the fan. There was no news on the level of recent withdrawals from the bank, which fueled speculation that yet more taxpayer-cash would be required soon.

But Peter Kurer was certainly a contrite CEO. He said:

We have admitted to our mistakes several times in recent months – and have also apologized for them.

Some letters have accused us of arrogance and say that we need to get off of our high horse. This, too, may have had an element of truth in it in the past – at all levels.

But let me reassure you, ladies and gentlemen, there is no room for arrogance in the UBS of today – nor will there be in the UBS of tomorrow.

Peter Kurer, it seems, values the role of PR in ensuring UBS’s recovery. He even praised the around the clock work of his communications department to shareholders in Lucerne. My friend had nothing but praise for his chairman’s commitment to communication.

They would both agree, I think, with what Leslie Gaines-Ross says in her timely book Corporate Reputation, 12 Steps to Safeguarding and Recovering Reputation, recovering a lost reputation is a marathon task, not a sprint.

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A PR’s heart is bound to leap when it reads the Barclays story. What an opportunity at last to stop schmoozing a soft-line to all comers.

There was no talk of aligning the values of employees, consumers, shareholders and other stakeholders. There was no talk of mutual social responsibility either. What was on offer was a take it or destroy it option. TINA was the Board’s message (There Is No Alternative). The board wasn’t playing nicely. George Dallas, corporate governance director at F&C Investments, told the meeting:

“We deeply object to being put into a position where the consequences of voting against this deal would make a bad situation worse.”

No wonder Barclays needed security guards to hold back shareholder anger when both retail and institutional investors were losers in an unprecedented fund raising exercise. Its chairman Marcus Agius expressed regret for the mess without backing down. Hence, nobody can accuse Barclays Bank’s board of lacking courage or leadership.

It has laid itself and its bank’s future on the line. It had the balls to reject the government offer of the taxpayers’ shilling because of the strings attached. Instead it sought more expensive capital elsewhere. In the process it shocked, indeed horrified, its existing stakeholders. But these are extraordinary times. The bank had few choices, it said (unlike Standard Chartered). There was no time for niceties. This was about securing long term survival, it argued. There were few advantages in going down the route of the near-nationalised banks, it said. What a narrative! We’re coming out fighting! We’re not giving in! We’d rather dangerous and costly independence than sucking on the state’s wet-nurse teat like babies!

The resistance won a few concessions – rather than a U-turn. Shareholders did take action to defend their interests as they saw them. The board was forced to reonounce its bonuses this year and next and put itself up for re-election annually.

It can be argued – and the FT has – that Barclays’ board is more accountable and more prone to listen to its shareholders than before. Perhaps had shareholders been less satisfied and more active over the last ten years the financial sector would be in better shape now. The period before – a period of boom in which many assumed bust would never reappear – was characterised by a complacant and meaningless consensus, with fake accountability and translucent transparency. Otherwise, we wouldn’t have got in to the credit crunch in the first place.

Barclays Bank will have to repair its relations with its shareholders. The board’s reputation will need nurturing. But this time around the whole process will be more volatile, more democratic and honest than what we witnessed during the amazing aberration of the last boom.

The wider PR lessons are that there will be far more different – and angry – messages flying around. Our clients are going to be fighting harder for much more differentiated positions which are sharper-edged. The arguments will be fiercer, more aggressive, less obvious.

We will have to accept that not every difference is reconcilable and not every stakeholder is going to be a winner.

Yesterday Barclays share rose by almost 10 percent. While, Standard Chartered shares fell 34½p to 725p.

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