Utopian PRs have been dreaming about “one world, people and planet” in which all the barriers between various publics come tumbling down. They envisage a connected world in which the lines of demarcation between internal, boundary and external stakeholders dissolve as they connect transparently and interactively in a value chain that links interdependent companies to their consumers and markets.

But such views ignore some major issues.

One is that in an open digitally-connected world, there’s more need than ever to conspire – organise, ghettoise, corral – to keep things confidential and hidden behind closed walls.

Indeed, we will see the kind of problem which Freedom of Information rules can produce: a clever, covert, closed decision making in which everything which really matters is centripetally driven to a cabal. (Remember the government of Tony Blair?)

Arguably, the more open things become and the more control bosses relinquish to networks, the more restrictions they will have to impose on those who operate in them. This might, paradoxically, lead to even tighter control on commercially sensitive information than exists today. It might lead corporates to adopt a civil service mantra of only releasing information on a need to know basis.

Another issue that the utopian PR camp ignores is competition. Companies forging various so-called value networks are as likely as not to form lots of them. They are as likely as not to value some more than others and to find themselves involved in contradictory and conflicting chains.

This will lead to lots of tension and uncertainty within corporates and institutions, such as government service providers, as they are forced to choose between their various product ranges, service offerings and partnership relationships, according to either their broader interests or their ability to sustain them. The resolution of such problems, or issues, will remain driven from the centre, from the top, by corporate or institutional bosses concerned with strategy.

Moreover, because of competition, PRs at either end of a chain, not to mention the middle, might find themselves pulling in different directions and unable to always align their interests, messages and narratives. There is no reason to believe that just because we introduce new tools into the workplace that real-world tensions, politics and commercial interests, will evaporate. We should, I warn, avoid the technological determinism trap.

My point is that we should not think that corporations are about to relinquish control to horizontal or flat digital networks. We should not kid ourselves that top-down management and communication are about to die out. Neither should we imagine, as the PR utopians do, that existing internal silos, lines of responsibility and accountability, will be or should be altered very much by commercial Web 2.0 and 3.0 applications.

Here’s what Norman Lewis, Managing Partner at Open Knowledge UK, had to say on this when he commented on my piece There’s no social media revolution:

… it’s definitely the case that social media like any other technology does not alter the realities of the business world. (I very much like your points about the chaos that would ensue in a company if everyone could relate to sales, customers etc). This is based upon the naive hippie prejudice that enterprises can become democracies run in the interests of employees empowered to act like free agents.

Another of the problems that’s being overlooked by utopian PRs is how social media usage in the personal sphere is maturing. They seem to have missed the point that the major stumbling block for social media of all kinds is privacy, trust and control over personal data. It would seem that social media users are emerging from the immature days of the early adoption period and starting to ask tough questions.

In the commercial sphere the risks and drawbacks have been fairly clear from the very beginning.

There is no doubt that knowledge-sharing, collaboration and instant feedback and decision-making all have great appeal. There is also no doubting that patents, IP, confidential information and in-house knowledge lie at the heart of commercial value. It is also obvious, or should be, that for legitimate reasons such as their survival, corporates are going to be reluctant to dilute and devalue their brand value and identity in an undifferentiated network. So the open Web 2.0 information flows between various players presents itself both as an opportunity and as a risk.

Yet there’s even more reason for PRs not to get over-excited about Web 2.0′s ability to transform the workplace as utopian PRs do when they talk about paradigm shifts. Some believe that Michael Porter’s value chain model has already been replaced – or almost so – “by fuzzy (and not linear) and immaterial (rather than material) networks that normally disintegrate the distinction between internal and external publics.” But the truth is that Web 2.0′s commercial applicability is in its infancy and has yet to make a great impact.

The point the utopians miss is how much experimentation will be required to ascertain where and how to make Web 2.0 and social media applications work best in the corporate and public sector domain given the virtual impossibility of measuring their benefits accurately.

Don’t get me wrong, however. I favour innovation and risk. I decry our current risk-adverse culture. I look forward to seeing more Web 2.0 and 3.0 applications introduced by business and institutions to deliver products and services. I don’t doubt for a moment that they can boost productivity and add great value.

I also accept fully that Web 2.0 and 3.0 provide a new sense of power and control to consumers and poses new challenges to corporates. So of course corporates need to manage this threat and turn it into an opportunity. But that aspect of the story was not what this post was about.

Note: This first appeared here in May 2010.

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1. PR should help leaders lead, not listen

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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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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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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All businesses are about relationship-building. Butchers, say, depend on it. As in: “I’ve some nice sirloin today. A bone for the dog?” One pitch of modern PR is to say that we manage the relationships other people can’t reach – or don’t spot. And indeed we are right to stress that nowadays, reputational risk is everywhere: your suppliers can let you down as easily as your managers. So, yes, PR is about a clients’ 360-degree reputational risk. We have to look at our clients’ relationship risk and its way upstream, way downstream – and all around. To some extent, we can fix those relationships, or find people who can.

But I think we’re starting to go too far, as though PRs were uniquely suited to giving a sort of therapy, or a laying-on of hands. We are at risk of not spotting that messages and influencing behaviour remain our core business.

Here’s an example from a popular blog and thought leader of the muddle PRs are currently in:

“Communicating (communications departments typically engage in: talking) is not a particularly useful skill. Relating is. Maybe it’s time to reclaim the words “public relations” and, more importantly, the philosophical principles that underpin those words. (Paul Holmes’s blog here)

Of course, I accept that our trade is public relations. But I insist that the essence of that remains preparing and communicating messages. We improve people’s relationships by ensuring they understand the value of developing their messages carefully, getting them out, and living up to them.

That means we are like diplomats, journalists and yes (blimey) philosophers. And we do indeed go further: we remind our clients, over and over, that good messages produce their own weakness and risk; we remind them that they have to walk the talk. A stated aspiration is a hostage to fortune, a challenge to our critics (stakeholders, indeed!).

You can have all the relationships you like with the media, with one’s neighbours, with one’s customers, with the NGOs, and when you don’t deliver the reality you’ve told them to expect, they’ll still all pile in on you with gay abandon and crocodile tears.

So of course, we PRs build relationships. But relationships are no sort of insurance or guarantee. They may not even be the best sort of investment. What you need is good behaviour, solidly communicated.

I’m trying to get it across that winning friends is not the necessary or sufficient condition of influencing people. The relationship of trust (which PRs may well want between themselves and their clients and the rest of the world, that great Other) is not the same as or even like the relationship of, say, friendship or affection. Reputations are about more than relationships.

Perhaps I can put it this way: I often trust people or institutions I don’t know and don’t like. I don’t have a relationship with judges, the police, firefighters, the surgeons in my local hospital, the drivers of Shell’s road tankers. I don’t want one either. I just want to be able to trust them.

By the way, new media don’t change any of this much. The people who twitter and blog may believe they are a new social entity, and PRs may believe that this new sociology requires a new sort of relationship-building. Like Harold Burson here, I doubt it.

Much was made of the new relationship Obama had forged with the American people in the new ether. Yeah, well, maybe. Right now, he seems to have gone on to hack off the floating, middling, uncommitted American centre ground. Will he get the enthused kids back? Has he got an ongoing, er, relationship with them? We’ll see. It looks to me that in important measure, what he surfed was a wave of enthusiasm, and it may have broken on the shore in a trillion sparkling droplets. His vast virtual Rollodex may develop into a relationship, but we can’t know yet because a relationship is a thing which gets a history or it isn’t anything.

Moreover, we’ve always known that the best PR is heard and not seen. That means that PR has mostly an indirect relationship to its target audiences – through the media, through third-party opinion formers and other influencers (advocates) whether that’s online or off, through the media or by other means.

PR’s hand is even more remote when, as Edward Bernays showed us with his “Torches for Freedom”, it manufactures consent by engineering events that help create a new social consensus or climate of opinion.

So I come back to the importance of asking the question, relationships with whom? Of course, most institutions and firms want good relationships with clients, opinion-formers, hacks, enemies, politicians stakeholders, neighbours and everybody else.

But, actually, most of those audiences don’t have time to have a relationship with you. What most audiences require is the right message, at the right moment via the right channel. Most of the people who determine what reputation you acquire (reputations are conferred by others) will respond positively (or dangerously). They won’t do so because they’ve been nurtured directly by PRs.

For advocacy to work, of course, people need to be persuaded to think a certain thing. Hence, it makes sense for PRs to engineer a genuine invitation to accept and meet informed challenge by the target audience – but very often still without engaging directly as the PR team – for anything controversial or requiring consent or acceptance by various stakeholders (new runways, licences to operate etc.).

Of course there are exceptions. Those are strategic and tactical considerations (Ryanair doesn’t talk to PlaneStupid, but many firms talk to Greenpeace, but some won’t talk to either and some talk to both).

There’s no love in war, competition, public opinion and the media, so why bother to be loved or liked? Being understood and trusted should be enough. That means putting integrity, truthfulness, evidence and authenticity at the heart of communication.

Note: this was first posted in 2009.

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This playground spat was sparked by some leaked emails to the blogosphere. It seems Facebook wanted to traduce Google’s new Social Circle offering for violating users’ privacy rights without being identified as the shit-stirrer. The cause of the media “outrage” was an upfront admission from BM in an email trail that:

“I’m afraid I can’t disclose my client yet.”

One supposes the reason for non-disclosure was that Facebook’s reputation on privacy matters is arguably worse than Google’s. BM added, however, that the full facts of the case they were advocating were already in the public domain. In other words, they were inviting somebody to follow up some pointers.

So, never mind that BM has apologized for their role in this; I’ll criticize that in a moment. I’m going to argue that their two PRs behaved pretty well (see here for leading PR Steve Earl’s similar opinion).

In this instance, BM were dealing with somebody who knew the agency were being paid by a third party for PR work. The PR agency also believed that their potential advocate supported the views they sought to spread. They outlined some lines of argument which were already in the public domain and not unreasonable. The blogger they approached was advised to check BM’s facts for accuracy and for the degree to which he agreed with them. What does it matter who was paying BM? Would it have mattered if it was the Devil? I think not.

Sure, BM broke their own ethical code of practice. They did not walk the moral talk they spout. But the worst thing about this whole episode was playing the blame game. Questioning a client’s integrity is not a good image for our trade. The denial from Facebook also did the firm no favours. Facebook is now, anyway, once more the main target of the media’s angst about the “betrayal” of user privacy rights.

The best response from both parties to the exposure of their relationship would have been simply to admit to it. Silence might have also sufficed. Unfortunately, my beloved “so what?” would have been problematic given how BM was flouting its own code of conduct.

But let’s not let the media off the hook. Their outrage is bluster. The media rarely tells their readers which story was sparked or parked by a PR working on behalf of a particular client. Readers are mostly left in the dark about the who, the what and how of the birth of a story. If it were not so, the names of PR agencies, political insiders and their staff would be all over nearly every story published.

Quite rightly, the best media – just like the best PRs – look to the accuracy, veracity and fairness of what they say, write and advocate to establish their credibility.

The fact is a writer might have all sorts of interests and prejudices – including commercial – when he states this or that opinion. He might have shares, or old grudges, or – yes – a payment directly from a party to write a particular piece. Does it matter? The answer has to be, up to a point and depending on the circumstances. For instance, a paid employee writing about their firm cannot pretend to be an independent bystander. An analyst or financial journalist recommending a share as a buy, and who has a personal financial motive for doing so, must declare it openly etc..

Nevertheless, as a reader, I am most interested in a writer’s opinion. If I find it interesting (well-argued, peculiar, entertaining, whatever), then I’m likely to be influenced by it. If I see a writer’s byline, I will be drawn to it if he was interesting in the past. Their new bit of writing will either continue to amuse, or fail to, on its merits. I can usually judge those myself. But sometimes I depend on the authority of the writer’s editors for my sense of the writer’s merits. That’s where the reputation of the likes of The Economist or WSJ etc. matters most.

So let’s keep this real. BM did not really sin. Our industry should come clean about how it and the media really functions and about on what premises trust and integrity really rest.

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When I launched this site in October 2009, my Big Idea was that PR was getting less honest as it got more goody-goody and bossy. I argued that it had fallen in love with the Corporate Social Responsibility model that it was selling to its customers. One big problem was that PRs started to pretend they could serve two masters, or even dozens. They could serve their client, and Society, and any “stakeholders” who came along.

A few years down the line, my book will explore the origins of PR in Classical Greece and elsewhere. I’m going to trace our trade from ancient to the modern times, when it became a pseudo-academic study like journalism. I’m going to thrash out whether PR is a trade or a profession, or both at different times. The kind of issue I’m interested in is this: are PRs like lawyers who are supposed to take any client but play by certain rules and are kept honest by adversaries? Or are we obliged to pick our clients carefully? If so, how dirty can we fight?

This site will trail some of my thinking as it emerges. As usual, I’m hoping that my readers will hold my feet to the fire and improve the way I think.

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A health warning. This is a 20 minute read. It’s a feet-up, cup-of-coffee or glass-of-wine read.

Its section go:

Trust: where’s the decline, really?
Inside the minds of kowtow thinkers
PR: The trade that hates itself
Different types of ARM PR
Three cases: BP, BA, France Telecom
The perils of modern individualism
Firms and institutions do not have to hate themselves
References

Trust: where’s the decline, really?
We are said to be in the middle of a crisis of trust. Since the public relations industry is supposed to be all about building the stuff – and since it has been well paid for at least 50 years to be ubiquitous and effective in doing so – one might expect us professional schmoozers to feel a bit guilty. Well, we don’t (or at least not much). We are more inclined to think that our clients rather deserve to be pilloried by the media and the public. Indeed, we are doing quite nicely out of advising businesses and other bodies on how to fix or manage the malaise.

As a matter of fact, I am a shade sceptical that businesses really are in the doghouse at all. When the ‘problem’ of the reputation of business first surfaced, I started looking at research on the subject. I was struck by the incoherence and inconsistency of what researchers claimed to have found. At the University of East Anglia, for instance, the Centre for Social and Economic Research on the Global Environment led the way in agonising over the public perception of risk. In one paper, it found that only a very small percentage of the residents of Norwich were prepared to trust information from government or firms [1]. A few more (but still only a very few) trusted information from the media. More people trusted doctors or scientists. By far the greatest number of people placed their trust in environmental campaigners, friends and family.

Given my way of looking at the world, this was bizarre, to say the very least. It did not seem to accord with the realities of where one looked for accurate information. When I turned the page, though, this selfsame report seemed to find something a bit more cheerful – and somewhat at odds with what I had just read. It appears that a Mori poll had found that, while less than half of the population was inclined to trust scientists to speak honestly, those scientists who worked in industry were rather more trusted than were those who worked for government. Those scientists who work for campaigners were distrusted quite strongly.

In short, industry need not think that its voice is uniquely tainted. Indeed, for all I know, its reputation might improve quite a bit if it spoke as many truths as possible and let time prove them accurate. It might even help if these truths were harsh.

Let us (just for the sake of it) assume that some public opinion research is accurate – or at any rate influential. Research by the Edelman PR agency indicates that firms in China, Indonesia and Brazil are more trusted than those in the UK, Germany, France or the USA [2]. Why might that be? One reason for the anomaly may be that the public in the BRIC countries – the new ‘Tiger economies’ of Brazil, Russia, India and China – is naïve about firms. Maybe, though, it is not so much about naivety as about a genuine – and even quite well-informed – hopefulness about progress.

Perhaps industry in the emerging economies is confident of its merit. Perhaps we should mourn the decadent, self-doubting introspection of modern western mores.

I am in PR and it behoves me to look at the part played by my own trade in shaping or influencing the western public’s attitude to its firms. PR professionals (let’s just call them ‘PRs’) are increasingly reluctant to defend the reputation of western firms. They would rather just go along with the prejudices that their researchers think they have uncovered than take on the tougher job of challenging them. They tell CEOs that their firms are hated or not trusted because capitalism is hated and not trusted. A vicious cycle ensues.

Many of us PRs are, of course, arts-type people with arts-type prejudices. We are (or would like to be) part of the metropolitan liberal world rather than the gritty commercial and entrepreneurial world. Like admen, we think of ourselves as ‘creatives’ rather than go-getters; as do-gooders rather than mere achievers. We often display a distinct dissidence, just like the journalists we spend so much time trying to influence. (Yes, I know PR is more than just media relations, but most PRs remain obsessed with social and mainstream media regardless.) If we were to be split into camps, these would be ‘liberal pragmatists’ and ‘pragmatists’: people with the wrong agenda or people with no agenda save for convenience. Either way, PRs have largely decided that what the media wants it ought to get.

Meanwhile, we PRs should not beat ourselves up too much either. Journalists say they don’t trust us. The public says it doesn’t trust the media. It’s all nonsense. Journalists get most of their information from PRs. The public gets most of its opinions from the media – mainstream or social. As a PR, I am able to spoon-feed journalists my information because what I say is accurate and well evidenced. They do not expect time to disprove what I tell them. That is the point about being professional: we have far more to gain from being accurate than we have from lying.

Going back to Edelman’s survey, its results show that PRs are less trusted as spokespeople than are lawyers. Who cares? I do not really believe that the public has any idea what PRs do, so it pays ignorant punters to play safe and to say they don’t trust spinmasters [3].

The problem with PRs today is not lack of credibility or influence. Rather it is how we exploit our powers of persuasion and how we perceive the world. PRs have convinced firms to launch pre-emptive communication campaigns aimed at stakeholders that (a) admit to the mistakes Darwinian capitalism is supposed to make; (b) apologises for the past practices; and (c) promises and demonstrates a willingness to reform. The objective, so it is argued, is to restore trust and to secure or maintain the licence of business to operate in a hostile world. Meanwhile, corporates and other institutions have accepted that self-abnegation is a sound strategy, because they accept that PRs know their trade. But do they? Have PRs become too willing to act as the prosecuting counsel and the advocates of cringe?

Something is wrong when, to take one example, the public’s trust in banks in India and China outweighs by far its confidence in London, New York or Zurich institutions [4]. Or rather, for all their recent failings, western banks are – at least in principle and largely in practice – a part of the wealth-creating open societies that host them. It may be that Asian banks, say, are less prone to hazardous innovation than are their western counterparts. But we ought to wonder whether they are more transparent, competent or trustworthy.

Therein lies another dimension that should make us a little more sanguine about the seemingly low levels of trust in western institutions: healthy scepticism is not the same thing as lack of trust, but it is a part of what keeps the West dynamic. That is certainly true of our scientific culture, and it has become almost too true of our democratic political culture. The corporate world is really quite prone to smugness and complacency. For that reason alone, it could probably do with a good dose of external challenge to keep it on its toes.

Still, I say PRs have sold business and society short. Of course, sometimes the public and the media call on an institution to apologise, reform and move on (ARM) for good reason. This is obviously the case when a firm or an institution knows it is guilty as charged. One example of this was in Canada in 2008, when listeria contamination of some Maple Leaf Foods products killed 22 people and harmed many more. When the origin of the contamination in its plant was identified beyond doubt, the firm accepted responsibility and unhesitatingly sought to make amends. But in most crises, actually locating blame is not such an easy task, and the issues involved are by no means one-sided or obvious.

In incidents such as Shell’s failure to dispose properly of its Brent Spar oil platform, France Telecom’s supposed responsibility for mass suicide, the Catholic Church’s child abuse scandal, or even Toyota’s recall of millions of its cars, the truths involved were conflicted, uncomfortable and awkward for all the parties involved. But in every one of those cases, most PRs urged the bodies concerned to surrender their integrity to the crowd and beg forgiveness, regardless of the facts.

Inside the minds of kowtow thinkers

One of the leading advocates of the kowtow PR culture in the UK is Sandra Macleod, group CEO of Echo Research. Her firm’s research on behalf of leading companies is often used by PRs to persuade CEOs and institutions to reform the way in which they behave, rather than to sell their core values more effectively. Here Macleod outlines her thinking:

“In our early days of innocence, many mistakes or misjudgements were made. We are paying the cost for it now – with pollution, climate change, distrust and mistrust. The ‘corporate speak’ train has reached its terminus. But awareness is the first step to the path of greater enlightenment and fundamental change and improvement.

“Harvard Business School Professor of Business Administration Rosabeth Moss Kanter’s new book SuperCorp argues that capitalism is at a crossroads. The old ways of doing business no longer work.” [5]

Macleod explains and endorses Kanter’s opinion that customers trust companies that do more than just provide goods and services. She also agrees with Kanter that workers are inspired by commercial opportunities, in which people go to work every day with the idea that they have two jobs: one to ‘do my job’ and the other to ‘change the world’. The ‘AAha factor’, says Macleod, is ‘we can do well by doing good’. She says that, by forming partnerships across sectors, firms bring together capabilities that promote the greater good, creating value for society beyond today’s markets and products. This is crucial. This style of PR argues that firms can only thrive by deeply, really internalising criticism from the world of activists and campaigners, including those who are profoundly anti-capitalist. In Kanter’s words:

“That has the potential to solve enormous social and environmental problems and, as a by-product, restore confidence in business. I hope that is the 21st-century model for the future of capitalism.”

In the same piece, Macleod quotes an article in the McKinsey Quarterly in support of her position:

“While unfortunately, short-term thinking is now endemic to business strategy… the financial crisis has increased the public’s expectations of business’s role in society. Most companies have maintained or increased their efforts to address socio-political issues, and many have already derived better-than-expected benefits from doing so.”

This view requires interrogation. The McKinsey line is interesting because it seems to imply that business is (a) short-termist in its approach and (b) long term in its societal aspirations. Is that not inviting us to say that the thing many people would like is for business to be business-like for the longer term? And if it achieved that, it wouldn’t have to get all self-conscious about saving the world? The major lesson of the recession, after all, was how bad things get when business fails at its day job, as the banks did.

As an advocate of ARM PR, Sandra Macleod captures well the new anti-competitive capitalism that her research says the public wants. She envisions a world in which:

“Governments [take] a stand and businesses [are] no longer seen as [the] unacceptable face of capitalism as balance sheets count [the] costs of social and environmental impact through policies, levies and taxation.

“A new science of qualities of life will emerge whereby growth and evolution are not seen as a competitive struggle but as a cooperative dance.

“Growth will be redefined beyond politics to a land of opportunities focusing on a better civil society and well being – in a world, as Senator Kennedy argued that ‘makes life so precious and makes us proud to be citizens of our countries and planets.’”

Macleod’s naivety (though I have no quibble with the value Senator Kennedy put on life) would once have been laughed at. The major point she misses is that it was market forces that built the great societies we live in. She too readily dismisses our heritage and denigrates the reputations that grew out of it. Moreover, her view does not reflect the tough realities that workers, firms and countries face as they battle to improve productivity and compete with each other in the real world (though the taxes are real enough). But Macleod’s line is the vision that many PRs recommend we sell to the public.

Another leader of the kowtow PR culture is Richard Edelman. He has a prominent platform at the World Economic Forum’s Davos summit, where he has reported how:

“…the consensus of CEOs was in favor of evolving the model away from Milton Friedman (the social responsibility of business is to make profit) toward a more nuanced approach of business’ positive contribution to society. Michael Porter, professor at Harvard Business School, said, ‘The greatest competitive advantage for business will be social. We used to believe there was a trade-off between profit and social issues. Now we know differently. We thought work place safety and environmental stewardship were expensive, but the highest return on investment comes from zero accidents and reengineering the supply chain to make you more efficient. Companies which understand complex social issues will turn them into competitive advantages.’” [6]

So, CEOs are being advised to present a utopian vision to their publics, in which all stakeholders are treated as equals, and in which firms exist to form partnerships with NGOs that are designed to promote ‘societal good’. They are even expected to pretend that business can or must engineer zero accidents and zero risk, which is downright misleading.

I want to be careful here, but not mealy-mouthed. Corporate social responsibility (CSR) and high levels of safety are – up to a point – Very Good Things. However, though some of today’s CSR is invaluable and well executed, I do (rather unfashionably) believe that much of it is useless or silly. Be that as it may, the main point I want to get across here is that corporates should not always and everywhere wave the white flag in the face of criticism. A permanent affectation of guilt is as psychologically dangerous for a firm as it is for an individual.

The trade that hates itself

The strange thing is that PRs have little confidence in the social contribution they and their clients make to society. For instance, when Richard Edelman describes how his company makes a social contribution to society, he reveals a distaste for the ‘unreal-world’ practices that lie at the heart of his core business: defending and promoting other people’s reputations and businesses. Instead, he urges his staff to ‘live in color’:

“What I mean by this phrase is that we have a responsibility to live in the real world [partly by doing pro bono work]… We must recognize that there is a responsibility to have continuing education in our field that is dependent on getting out of the office, beyond the small world of billable hours, into a big world of imagination and social contribution.” [7]

His message appears to be that billable work does not make a significant social contribution to society, and that its content is detached from the world of imagination. He seems to be saying that we PRs reconnect with the world by doing stuff outside the office, rather than by creating the world we live in at work. In my experience, however, pro bono often risks becoming merely a stressful, self-interested extension of work and brand building (that is not virtuous at all). There is no dispute about the benefit of staff leading an active and constructive social life beyond paid work. But Mr Edelman ignores the obvious point that his staff need to remain billable, so as to live full and productive lives with their families in their communities. What I oppose is the dispiriting and demoralising consequences of Mr Edelman’s ‘live in color’ mantra, which denigrates his core business’s value and PR’s contribution to society.

Different types of ARM PR

Sometimes the focus of ARM PR is limited and sometimes it is wholesale. When it is limited, it involves reforming business practices, adopting CSR and sustainability programmes and resolving to do better in the future (some of this is certainly progressive). But when it’s wholesale it involves redefining a business, often for very dubious reasons. I have identified three broad camps into which firms and other institutions fall when it comes to ARM PR:

1. Those who adopt ARM as a PR strategy while not believing it. I think British Airways and BP fit this bill.

2. Those where the most senior people genuinely believe that the business has failed morally to some degree. Body Shop, Ben and Jerry’s (especially in its pre-Unilever incarnation), Timberland and maybe even HSBC belong here. The effect is that they seem anti-capitalist and appear to want to create a thoroughly post-Darwinian corporation.

3. Those that have suffered a cock-up and believe energetic apology is the most
effective strategy, whether or not they believe they are actually guilty. Here I would cite Toyota, certain banks and France Telecom. In the non-corporate sphere, one might add many UK social services departments.

So firms go along with this ARM PR agenda with varying degrees of honesty and enthusiasm. Some businesses have turned their anti-establishment agenda into a major part of their claim to integrity. Body Shop’s message, for instance, was validated by the genuine (and rather absurd) anti-corporate enthusiasm of its mouthy CEO and chairman. Similarly, it may be that HSBC’s adoption of CSR is genuine, given that its boss, Stephen Green, seems a genuine (and perhaps religiously motivated) enthusiast. But then again, banking and banks are about profit and loss, and there is no escaping the fact. The problem with all three approaches is that they all involve a display (to varying degrees) of self-hate, self-pity and cynicism about the nature of business per se.

Three case studies: BP, BA and France Telecom

BP’s ‘beyond petroleum’ was self-deception

Peter Sandman, the former PR consultant to BP, has given an insider’s insight into the rebranding of British Petroleum. He described how the company first became simply BP, then went on to adopt the lower-case bp on its logo, and finally redefined the meaning of BP as ‘beyond petroleum’. He cited this as an example of a company adopting the ‘reformed sinner’ persona. Addressing a group of PR and mine managers in Australia in 1998, he said that this:

“…works quite well if you can sell it… [Big oil companies] have done a very good job of saying to themselves, ‘Everyone thinks we are bad guys… We can’t just start out announcing we are good guys, so what we have to announce is we have finally realised we were bad guys and we are going to be better’… It makes it much easier for critics and the public to buy into the image of the industry as good guys after you have spent a while in purgatory.” [8]

John Kenney, one of the two Ogilvy & Mather executives responsible for BP’s ‘beyond petroleum’ tagline, outlined their methods in the New York Times [9]. He described how they talked to people on the street and heard a lot of gripes about oil companies. From what he says, he does not discount this sort of view or filter it or ponder its validity. He does not seem to care whether the views he hears are well informed, prejudiced or intelligent. But he decides to try to fix the perception problem – as indeed was his job. So Kenney and his boss develop a line which says, in effect: Look, BP are doing all sorts of things to address the ‘oil problem’.

The compelling attraction of Ogilvy & Mather’s ‘beyond petroleum’ tagline was that it matched what their research revealed: that the public claims to hate the oil business. Rebranding BP appeared a sensible way of outflanking public opinion by showing that the business was equally uncomfortable about the nature of its core business. That might have been a credible position had BP been serious about getting out of oil. But it wasn’t.

There was, of course, a rather major problem with the notion of BP going ‘beyond petroleum’. The realities of global warming (whether scientific or political) made oil more attractive than coal, just as it made gas more attractive than either of them. Demand for oil soared during the boom times. New drilling techniques were developed and new oil fields discovered. It soon became clear – and all along should have been – that BP was not going to be ‘fossil fuel free’ so much as ‘fossil fuel plus’. Hence Kenney writes in the New York Times:

“I guess, looking at it now, ‘beyond petroleum’ is just advertising. It’s become mere marketing – perhaps it always was – instead of a genuine attempt to engage the public in the debate or a corporate rallying cry to change the paradigm.”

BP was forced to rethink its ‘beyond petroleum’ stance after a couple of crises revealed that it was neglecting its day job. In 2005 there was the explosion that killed 15 people and injured more than 100 others at a BP plant in Texas. Then the following year there was a pipeline corrosion and oil leak crisis in Alaska. Both incidents highlighted that BP should have been more interested in petroleum and safety than in the company’s super-planetary virtuousness. The setbacks resulted in a change of leadership and a shift of emphasis back to oil. These events led some BP staff to re-label BP as meaning Big Problems [10].

As I write, in the Gulf of Mexico BP has just managed to staunch the flow of the biggest oil spill in US history. In terms of reputation, this is perhaps the biggest issue ever faced by any company. Since the Deepwater Horizon oil platform blew up and sank in April, oil has been gushing almost as furiously as Barack Obama’s anti-BP rhetoric. He has, of course, re-rebranded the company ‘British Petroleum’: this is a man who understands that the Americans are torn between respect for and dislike of the British. The handy trope of British arrogance is always available to American propagandists.

This all serves to remind us that the original rebranding of British Petroleum as BP/bp (not to mention ‘beyond petroleum’) was about as forlorn as the relabelling of Windscale as Sellafield after the nuclear plant’s chimneystack fire of 1957.

But it is moot whether – just because it became fairly adept at love-bombing the green vote – BP became any less competent in engineering terms. Though I suspect strongly that, if BP did lose engineering focus, this was because its drive for profit and deals was disguised behind a veil that misrepresented reality to both the company’s employees and the public. Arguably, ‘beyond petroleum’ became a risky distraction and a demoralising influence on the company’s reputation, safety culture, sense of self-worth and identity. In fact (and the appointment of Tony Hayward as CEO shows this, as does his subsequent replacement by Robert Dudley), BP was busy reminding itself of the merits of being technically competent and focused on the core business even as God, in his inimitable way, bowled it an untimely beam ball.

The reality BP had accepted was that its oil business had grown in size and risk, while its safety record in the US had gone downhill:

Two refineries owned by oil giant BP account for 97 percent of all flagrant violations found in the refining industry by government safety inspectors over the past three years… Most of BP’s citations were classified as ‘egregious, willful’ by the Occupational Safety and Health Administration. [11]

According to the ABC news website:

“[Occupational Safety and Health Administration] statistics show BP ran up 760 ‘egregious, willful’ safety violations, while Sunoco and Conoco-Phillips each had eight, Citgo had two and Exxon had one comparable citation.” [12]

We do not know what BP’s American future will be. I for one certainly hope it will thrive there precisely because it does the right thing on every front in the Gulf, beginning with proving engineering diligence and continuing with being clear about its responsibilities (including their limits). I also hope that Barack Obama pays the full price for his finger-wagging and scapegoating, and not least for his pettish dislike of the British.

Presumably, Barack Obama is throwing as much mud as he can at BP because he recently lent his support to offshore exploration. He can thus in some sense be assumed to have approved of the regulatory regime that signed-off on BP’s operations in the Gulf.

Of course, the challenge for BP will be to switch from presenting itself as a self-hating sort of organisation that is keen to disguise its real, so-called ‘grubby’ purposes as it seeks to appeal to green opinion. I have mostly argued that firms should not cringe. At this moment, of course, BP must be penitent. But I shall risk saying that it must not stop being thoroughly adult. Insofar as it has done wrong, it must quite soon admit its part of the blame. It can then build on what seems to be its current quite sensible strategy – which is to say that it will stand by those it has damaged. Let us hope that BP can now play a noble role in a general corporate desire to move beyond infantilism.

The truth is that BP was always very, very petroleum. ‘Better (or even Best) Petroleum’ would have been – will be – a better tagline than ‘beyond petroleum’. But here’s another important truth. BP’s long-term trustworthiness and profitability may well survive this disaster, just as the Gulf of Mexico might recover more quickly than many observers expect. What is more, the disaster is likely to make it clear how the two properties of trust and profit are inextricably bound together.

BA: briefly ashamed of its flag’s roots

British Airways is another company that felt compelled to appear embarrassed by its roots. In 1996, it famously took the Union flag off its tailfins, logo and stationery.

The BBC reported at the time how BA’s aim was to create a cosmopolitan-feeling airline, not one trading on past glories of the Empire. It quotes Bob Ayling, the then head of BA, saying: ‘Perhaps we need to lose some of our old-fashioned Britishness and take on board some of the new British traits[13].’ The new ones were cited by Ayling as being linked to Britain’s ‘new’ friendly, diverse and open-to-all cultural image, rather than its old, rather remote and aloof one.

The Union flag was replaced on the carrier’s fleet by the many colours of the world. Symbols of the Ndebele tribe of Zimbabwe, animals and trees appeared on its Boeings. The airline’s Citiexpress Embraer sported Paithani – a variety of sari – on its tailfin. The company said its new ethnic makeover – costing £60 million – connected with the modern world, and not least with the 60 per cent of its passengers who were not British. In the process, BA rebranded and reformed itself.

To BA’s surprise, it discovered that its core values – all of which were hard-core, old-time, unabashed British – were prized by its non-British customers almost as much as by its British ones. Following a public rebellion led by consumers and a PR meltdown led by the media and politicians, the Union flag reappeared, with a BA spokeperson proclaiming:

“Rod [Eddington, Ayling’s successor as CEO] feels that Britishness is at the core of this airline’s appeal. We are a global carrier, but we are British and proud of it – and it is not just Britons who like our Britishness. Rod wants BA to be associated with Britain in the same way that BMW is associated with Germany, symbolising quality in a way that is understood worldwide.” [14]

France Telecom disingenuously admits guilt

Ever since it was semi-privatised in 1996, France Telecom, Europe’s biggest internet provider and third largest mobile operator (trading as Orange), has faced mounting competition and has been busily restructuring its business. Responding to union and political pressure, the company has been reluctant to make too many staff redundant. It has attempted instead to hang on to most of them, and in so doing created its own nightmare. Though it fired 60,000 employees, it redeployed many more thousands of otherwise redundant staff to newly created posts. It retrained many of them as salesmen, known as mobilités professionnelles (meaning they often worked away from home).

In reality, France Telecom workers were being pushed into unfamiliar roles, in jobs that were ill-defined. Staff sensed that many of them were in unsuitable positions, doing non-jobs that had no future or any real reason to exist. Meanwhile, management applied pressure to make the new structure work effectively. Given that most of the workers had no real role to play or any real prospects in their new jobs, they became understandably stressed and frustrated. They felt undervalued and under threat.

As discontent grew, so the focus of people’s anger concentrated on a spate of suicides and attempted suicides among France Telecom staff over an 18-month period in 2008–09. Some of these suicidal staff left notes blaming the company, and some of them attempted suicide at work. However, there was no real evidence that the company’s change-management strategy was to blame. As Oliver Barberot, France Telecom’s head of human relations, told the French satirical weekly newspaper Le Canard enchaîné:

“It’s [the number of suicides] not that dramatic, I have seen worse. The number of suicides is not even going up. In 2000 there were 28 and in 2002 there were 29 [compared to 24 suicides in the 18-month period that provoked the headlines].” [15]

However, despite the number of suicides being below the national average for the age profile of its staff, and despite the number going down rather than up, the company did not defend itself. It did not do so in the fond expectation that this would restore its reputation. Instead, it suspended its retraining programme of mobilités professionnelles. It employed more human relations staff and physicians who specialised in occupational medicine. It sent its heads of department on tour around France to investigate why their workers were so unhappy. First, Louis-Pierre Wenes, the architect of the modernisation drive stood down. Then the chief executive, Didier Lombard, was forced to resign, though he has remained the company’s chairman. In the process, France Telecom found itself paralysed for more than a year. It has yet to recover.

In effect, France Telecom ‘apologised’ and promised to ‘reform’ and to ‘move on’ in response to ‘outraged’ public (read media) opinion. By doing so, the company made it harder not only for itself to function as a business, but also for other firms to manage similar structural and emotional issues. So here is why I think it is immoral to resort to ARM PR in cases where the employer knows it is not the guilty party:

(1) ARM invites firms falsely to portray themselves as villains (think BP with ‘beyond petroleum’ and Shell with its Brent Spar oil platform).

(2) ARM invites firms falsely to assert that they can manage their affairs in ways that do not cause pain (France Telecom).

(3) ARM invites firms to dissemble (after all, it is untruthful to say you accept blame when actually you don’t and there is no evidence that you should). For instance, if France’s culture makes middle-aged men prone to suicide, does it help society to head off blaming France Telecom and then for France Telecom to blame itself?

(4) ARM creates moral hazard: campaigners know they can make false accusations and make their targets pay – think Pfizer with its Trovan crisis in Nigeria, where it stands accused of killing 11 children in a clinical trial [16]

(5) CSR – one could add sustainability and corporate responsibility generally – is an empty shell, inviting contempt, unless it speaks to business realities (think about the moral crusade against banks and what it will actually take – and what we shall have to accept – to get them working properly again; and think public sector cuts and the truth of the pain they will cause).

The perils of modern individualism
I make the point on my blog 21st Century PR Issues [17] that there is a problem with modern individualism: it makes people nurture their vulnerability and makes them see themselves as victims of capitalism, whereas in fact they are more likely victims of emotionalism, nonsense and downright deception. In short, France Telecom said it cared for the inner self of its employees when it didn’t; or, if it did care, it said so when there was only so much it could do to help (which was not much).

Of course, ARM PR works in the short term; but over a longer period it is corrosive. It buys firms breathing space in a crisis. It also breeds an underlying unease among the public(s) about motives, and gnaws at the self-confidence of the very firms that practise it. For instance, it is interesting to note that the suicides and stress at France Telecom were all among those workers who kept their jobs: presumably those who lost theirs suffered less angst because they knew where they stood.

The turmoil at France Telecom is a classic example of self-hate and self-flagellation gripping western business. France Telecom was by no means an uncaring monster; its problems stemmed from its attempt to please too many of its stakeholders – particularly the unions. Of course, leaving aside France Telecom, France itself is a country where things tend to be controlled by the state. Many of the company’s problems were created by political considerations. However, the logic this case highlights will be recognised by lots of employers (not least British Airways, which nearly fell into the same trap with its over-indulged trolley dollies).

Firms and institutions do not have to hate themselves
Peter Cappelli, professor of management at the University of Pennsylvania’s Wharton School, carried out a study based on interviews with the heads and human resource departments of 98 of India’s 150 biggest companies on the key differences between Indian and western bosses. According to the CNN website, he found that:

“…every leader interviewed gave a specific social purpose as being the goal of their business. Those purposes ranged from improving healthcare in India, to getting cell phones to people who don’t have access to communication tools, and proving to the international community that Indian companies can lead in IT.” [18]

Thus Indian bosses are committed to motivating their staff around whatever it is that the core purpose of the business happens to be:

“In terms of lessons for managers elsewhere, one of the most important things is that Indian leaders lead with a sense of social purpose.”

So one has to promote one’s firm as having a social purpose. Of course that makes sense. But for some reason, in the West we seem to have reached a point where sticking to the knitting – doing the things the firm is overtly dedicated to – will not suffice. Indeed, this has come to seem deeply suspect. Only the ‘add-on’ of CSR is sellable.

But the core purpose of a pharmaceutical or a phone company is the same in New York or Newcastle as it is in New Delhi. The difference is that in India it is pushed to the fore as the reason for the firm’s existence.

These things are necessarily nuanced. Indian bosses reported that they had less pressure to meet quarterly targets than their western counterparts, and therefore they could set more long-term goals. That indeed is a luxury worth having.

Certainly the West has a problem with planning for the long term, and we must fix that. But it is worth noting that the Indian economy is massively profitable on the back of low labour costs and a focus on core purpose, and that its focus on financial performance is relentless.

The self-confidence of Indian and Chinese business contrasts sharply with the ‘miserablism’ of the West. This leads me to my conclusion.

Right now, it is not so much that PRs are lying about the real world (though sometimes they do), as that they are recommending – whether from conviction, cynicism or pragmatism – that firms and other institutions should wear the badges of self-hate, self-pity and low self-esteem on their sleeves. The problem is that such sentiments are now deeply embedded and internalised at all levels of society. Hence, there is an urgent need for a more robust, self-confident style of PR to emerge. Not least because the world is changing.

There is a new balance of power emerging in the world as the BRIC countries rise to prominence without the restraining hand of the West’s insecure emotional baggage. Survival in this new environment calls for robust, often brutal and agile strategies and tactics, delivered at speed by leaders who are accountable for their decisions. In support of this challenge, PRs should be discussing how we position and sell this new world to the masses – among whom many will be losers and many more winners. Rather than knocking them, we should be shoring up the backbone and confidence of western firms and institutions.

References:
1. Tim O’Riordan, Claire Marris and Ian Langford (1997) ‘Images of science underlying public perceptions of risk’, in Science, Policy and Risk. London: Royal Society.

2. Edelman Trust (2010) ‘Building a mosaic of trust’ (Executive Summary), available at: www.edelman.com/trust/2010/

3. Charles H. Green (2007) ‘Trust and the PR profession’, available at: http://trustedadvisor.com/trustmatters/137/Trust-and-the-PR-Profession

4. Edelman Trust (2010) ‘Building a mosaic of trust’ (Executive Summary), p. 4, available at: www.edelman.com/trust/2010/

5. Sandra Macleod (n.d.) ‘CR and sustainability, commit or crunch?’, available at: www.ipra.org/detail.asp?articleid=1446

6. Richard Edelman (2010) ‘A sober and reflective Davos’, Richard Edelman website, 3 February, available at: www.edelman.com/speak_up/blog/archives/2010/02/

7. Richard Edelman (2004) ‘Living in color’, Richard Edelman website, 21 December, available at: www.edelman.com/speak_up/blog/archives/2004/12/living_in_color.html

8. Bob Burton (1999) ‘Packaging the beast: A public relations lesson in type casting’, Center for Media and Democracy website, available at: www.prwatch.org/prwissues/1999Q1/beast.html

9. John Kenney (2006) ‘Beyond propaganda’, New York Times, 14 August, available at: www.nytimes.com/2006/08/14/opinion/14kenney.html?_r=1

10. Michael Harrison and Andrew Buncombe (2006) ‘BP: Big problems for oil giant’, Independent, 30 August, available at: www.independent.co.uk/news/business/analysis-and-features/bp-big-problems-for-oil-giant-413933.html

11. Jim Morris and M. B. Pell (2010) ‘Renegade refiner: OSHA says BP has “systemic safety problem”’, Center for Public Integrity website, 16 May, available at: www.publicintegrity.org/articles/entry/2085/

12. Pierre Thomas, Lisa Jones, Jack Cloherty and Jason Ryan (2010) ‘BP’s dismal safety record’, ABC World News website, 27 May, available at: http://abcnews.go.com/WN/bps-dismal-safety-record/story?id=10763042

13. ‘R.I.P. British Airways’ funky tailfins’, BBC News website, 11 May 2001, available at: http://news.bbc.co.uk/2/hi/uk_news/1325127.stm

14. Paul Marston (2001) ‘BA restores Union flag design to all tailfins’, Daily Telegraph, 11 May, available at : www.telegraph.co.uk/news/uknews/1329843/BA-restores-Union-flag-design-to-all-tailfins.html

15. Stefan Simons (2009) ‘French government steps in to stop staff deaths’, Spiegel Online International website, 17 September, available at: www.spiegel.de/international/world/0,1518,649715,00.html

16. See ‘Trovan fact sheet’, available at: http://media.pfizer.com/files/news/trovan_fact_sheet_final.pdf

17. http://paulseaman.eu/

18. Mark Tutton (2010) ‘What bosses can learn from India’s business leaders’, CNN International website, 5 March, available at: http://edition.cnn.com/2010/BUSINESS/03/05/india.leadership.lessons

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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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