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November 29, 2004
Ethics in PR
The PR industry suffered two blows in the past month. The Wall Street Journal reported that Qorvis, a Washington, D.C. based public affairs firm, on behalf of a large insurance company, recruited third party experts on an anonymous basis (via a speakers bureau) to criticize regulatory overreaching by NY State Attorney General Spitzer. This led to an op-ed article by James Stewart in the same paper later that week suggesting that the best move for a company in crisis was never to hire a PR firm. Then the Controller of the City of Los Angeles issued a report last week alleging that Fleishman-Hillard had over billed the city's water department by $4.2 million. Knowing the senior management of the firm, I am confident that this matter will be resolved with alacrity and to the mutual satisfaction of all concerned. Yet the issues raised in these two situations are worth serious consideration.
Let me begin by recognizing that those who live in glass houses should not throw stones. I am sure that in the 53 year history of Edelman, there have been instances where we have drifted too close to the ethical line, whether in our choice of client or in our tactics on behalf of clients. With that caveat, I have a few thoughts that I hope will prompt further discussion in our industry.
First, we should not take on any client in the way that a lawyer can claim that every client deserves representation. We are not working in a court of law. We are working in the court of public opinion. We cannot say that the media is the ultimate screen on truth or the jury for the public. We are increasingly sending messages directly to end users of information, without the intermediate step of the media. What we disseminate often moves into public discourse with immediate effect and this information can move markets, affect consumer health or well-being. We should have a higher standard today on who we represent and what we say on their behalf.
Second, we need to be utterly transparent in our work methods. If we are trying to put forth a controversial point of view, we should give our clients the best chance of success. The way to do it is to be entirely forthright on motive and funding source. The process of communication is now seen as a litmus test of the honesty and integrity of the client. It is more than what you say, it is how you say it, that matters.
Third, we should demand a seat at the decision making table and not simply accept the role of mouthpiece for legal counsel. We have a unique sense of the potential impact of a given action on multiple stakeholders, from Wall Street to employees and consumers. If we are limited to a classic, small box communications role, we are unable to fulfill our broader mandate of advice and counsel.
Fourth, our billing methods should provide the same incentives to client and agency. Most PR firms look at billability or utilization rates of personnel to assure appropriate profitability. This sole focus on the most economic use of resources fails to assure quality or client satisfaction. What is required is a broader analytic framework, akin to environmental economics, where "externalities" are measured. One possible solution is a performance bonus, granted by clients for achieving specific measurable objectives. Another solution is to return to a retainer-based billing structure, with the agency committing staff against a set fee for a specific amount of work.
As an industry, we are just now recovering from a series of setbacks, from the implosion of the technology sector which provided up to 40% of PR fees in year 2000 to the Sarbanes-Oxley induced reticence of executives to speak to business media. Today we are seen as central to the decision making process at enlightened companies. We can be the growth segment of communications. We just need to self-regulate, so that our word is our bond, because nothing less will do.
Richard
Posted by Edelman at November 29, 2004 9:13 AM |
Comments
Right On! We can no longer rely on the media to filter controversial issues. Partnership between legal counsel and PR professionals is the only way to honor our professions ethical obligations of truth and transparency. Many of us attorneys respect tremendously our responsibility toward the shaping of public opinion (those of us that do sometimes don't earn very much, but we definitely sleep better at night).
Posted by: Nichelle Jenkins at November 29, 2004 6:53 PM
"we should demand a seat at the decision making table"
before one can demand something, one needs to prove that it is deserved or that they have earned it.
Can you give any examples of someone going from PR into a C-level position? How many people from purely PR backgrounds sit on boards of major companies?
Posted by: John Scotti at December 3, 2004 12:26 PM
John, it is happening. Charlotte Otto, PR director of Procter & Gamble, sits on the board of Royal Bank of Canada. Dave D'Allessandro moved from PR into the CEO position at John Hancock Insurance. PR people are moving on up.
Posted by: Richard Edelman at December 4, 2004 7:43 AM
Have you ever noticed thad most of thouse who work in PR are women?
Posted by: Miranda at August 1, 2005 4:04 AM
Miranda,
Indeed I have. As I am the lucky father of three girls in a private, family business, I understand fully the benefits of women in my professional and personal lives!
Richard
Posted by: Richard Edelman at August 1, 2005 9:58 AM