Do the Murdoch and Autonomy scandals show that the billions spent on corporate PR are wasted?

I’ve no idea how much has been spent on what we used to call corporate public relations over the last decade but it must run into many billions of whatever currency you choose.

Since PR firms had the bright wheeze of calling their offer ‘reputation management’ (and you wouldn’t want to be without that would you?) the amount of wonga involved rose still further.

Yet, arguably, corporate reputations have never fallen so far. Big companies are not just regarded as unfeeling capitalists (which mostly they are, but that’s what it says on the tin) but crooks occupying the gutter. So do we mean managing reputations down?

There is a perfectly justifiable case for PR. It’s the activity that used to be carried out by press officers, in-house people charged with conveying what a company or institution was doing to journalists. Over the years this was outsourced and so we had PR companies. Again, fine, as much a matter of distribution as anything else and there are a lot of journalists to service. Why not get someone else to do it?

But buffing up corporate reputations that appear not to deserve it is a different matter entirely. But that’s where the big bucks are.

Let’s take this week. We’ve had more revelations about the tax-dodging tricks of the world’s biggest companies: tech companies (mostly) are in the spotlight right now, led by the sainted Apple. Google, eBay and Amazon are in hot pursuit of Apple’s dubious crown though.

Yesterday we had those two old favourites Rebekah Brooks and Andy Coulson facing yet more charges, this time bribing members of the police, Royal Household and a woman at the UK’s Ministry of Defence – which is serious stuff. Actually Brooks owned up to the police bit of this some years ago before a Parliamentary Committee but was promptly shushed by Coulson, then editor of the News of the World. At the time nobody thought much of it.

But News International and owner News Corporation’s reputations have been trashed again despite a protracted effort by News spinners to say that the stable had been cleaned.

Also yesterday we had Hewlett-Packard (or HP) claiming that the managers of UK software firm Autonomy had misled it about sales (and doubtless lots of other things) as it wrote off $8.8bn over the disastrous purchase. Autonomy founder and boss Mike Lynch trousered about £500m in the sale.

Now Lynch (left) and Autonomy may be perfectly innocent: some people (bloggers mainly) said the price was ridiculous in the first place. But, at the very least, HP looks stupid and Autonomy greedy.

And the public, on both sides of the Atlantic and elsewhere too no doubt, will view all these cases as further evidence that big business is inhabited by crooks and shysters. And who can blame them?

I now hear, squeaking at the back of the class, a ‘reputation manager’ from WPP or Omnicom or Publicis Groupe or Edelman (the biggest of the independents) or somewhere else entirely (they offer degrees in this stuff these days) to the effect that it wasn’t me guv, we can only work with what our clients give us. If it’s a pack of lies that completely fails to represent what the company is about, that’s not our fault.

But it is. Even those old heroes in public esteem advertising folk have to make some efforts these days to ensure that what they say in their ads is, more or less, true. Certainly that it isn’t a farrago of lies.

No such burden rests on the world’s reputation managers. And it bloody well ought to.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.

One comment

  1. Steven…
    I am shocked Sir, shocked, that you would suggest that big business is inhabited by crooks and shysters!!! I just did a piece for talking about the millions BP (Yes, the “B” stands for “British,”) has spent on really wanky TV spots featuring golden sands, sparkling Blue Ocean and pristine birds flying over a Gulf Bay coastline that not long ago was an environmental disaster. Perhaps the $31 billion they will have to pay in pollution and environmental penalties under the Clean Water Act and Oil Pollution Act might make this a reality. No wonder it’s called “Public Relations.” Far too often, the public seems to have an incredibly short memory.
    Cheers/George “AdScam” Parker