Why CEOs don't get good PR counsel: they must upgrade the role of PR pros.Boeing has been reeling under a three-year cloud of scandals. But new CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Jim McNerney, a veteran of General Electric and 3M, is beginning to pull the company out of its PR nosedive nose·dive n. 1. A very steep dive of an aircraft. 2. A sudden, swift drop or plunge: Stock prices took a nosedive. Noun 1. , both by instituting clearer rules of ethical conduct and by launching an effective public relations public relations, activities and policies used to create public interest in a person, idea, product, institution, or business establishment. By its nature, public relations is devoted to serving particular interests by presenting them to the public in the most strategy. He is encouraging his managers to end their culture of silence, a trademark of the old Boeing. And people who know him say that McNerney has a healthy respect for the PR professionals who are advising him and that he understands the need to invest in reputation management. Unfortunately, McNerney is the exception to the rule. Most CEOs are not receiving the quality of PR counsel they need, largely because they do not recognize its value and do not have confidence in their communications executives. When a major crisis rears its ugly head, most CEOs do not invite their top PR person into the inner sanctum as part of their team of "cabinet" level executives. CEOs instinctively hammer out most of the strategy with their general counsel or outside legal specialists. The crucial communications strategy invariably--and mistakenly, in my opinion--falls to the lawyers. A classic case was the decision by Philip Morris CEO Geoffrey Bible to override his PR counsel in the mid-1990s and refuse to settle lawsuits related to cancer. The damage was so severe that the company ultimately had to change its name to Altria. More recently, two federal attempts to make business more transparent may have had the unintended consequence For the 1996 novel by John Ross, see . Unintended consequences are situations where an action results in an outcome that is not (or not only) what is intended. The unintended results may be foreseen or unforeseen, but they should be the logical or likely results of the of exacerbating this downgrading downgrading A reduction in the quality rating of a security issue, generally a bond. A downgrading may occur for various reasons including a period of losses, or increased debt service required by restructuring a firm's capital to include more debt and less of the PR voice. The Securities and Exchange Commission's Fair Disclosure regulation, or Reg FD, adopted in 2000, requires corporations to disseminate information to all investors and the public simultaneously, ending the practice of leaking financial insights to favored securities analysts. And the Sarbanes-Oxley Act See SOX. of 2002 requires management certification of financial controls. Companies have responded to both by turning to their lawyers to ensure that all communications comply with the new rules. [ILLUSTRATION OMITTED] And there's the rub. Lawyers often do not have the training to deal with communications strategy. To be sure, lawyers are a critical component of any good crisis communications Crisis communications are generally considered a sub-specialty of the public relations profession that is designed to protect and defend an individual, company, or organization facing a public challenge to its reputation. team. However, they are invariably in·var·i·a·ble adj. Not changing or subject to change; constant. in·var i·a·bil more focused on protecting the company from lawsuits than on
matters that can affect its reputation. Lawyers often counsel silence in
times of crises.
But there are times when such silence can have a devastating dev·as·tate tr.v. dev·as·tat·ed, dev·as·tat·ing, dev·as·tates 1. To lay waste; destroy. 2. To overwhelm; confound; stun: was devastated by the rude remark. effect on a company's credibility, particularly a public company. Effective communications professionals are "sensitivity barometers." They can detect even subtle mood shifts or changes in the way internal and external audiences perceive a company. They are almost always better equipped than lawyers to determine the correct communications tactics and strategies. So CEOs would be wise to raise the status of communications executives. CEOs should also develop stronger internal crisis teams by building firm alliances between their legal advisors and communications professionals, giving each an equal voice in determining strategy. One reason this is so important is that the climate of opinion has changed. The public and the media, having seen the antics of Enron, WorldCom and Tyco, will not tolerate any appearance of stonewalling stone·wall v. stone·walled, stone·wall·ing, stone·walls v.intr. 1. Informal a. and will no longer be willing to give American business even the benefit of the doubt. Anything less than candor, in today's highly charged atmosphere, can have serious consequences for a corporation and those who are responsible for its success. Robert Marston is chief executive of Robert Marston and Associates, a New York-based public relations firm. |
|
||||||||||||||||||||

i·a·bil
Printer friendly
Cite/link
Email
Feedback
Reader Opinion