Last week’s stunning Supreme Court decision that will now allow corporations and labor unions to spend an unlimited amount on election campaigns has sent shock waves across the political landscape with some lauding the sanctity of the First Amendment and others predicting the downfall of democracy as we know it. The case brought together an unusual coalition of the right (Chamber of Commerce) and left (ACLU) in support of scuttling McCain-Feingold. Opinions on what this will mean for the 2010 elections and beyond span a broad spectrum as Members of Congress and the Obama Administration are already debating legislative initiatives to take on the ruling.

As politicians and the pundit corps look ahead breathlessly to a new electoral dynamic, corporations need to closely review the decision and do a thorough analysis of how best to proceed. The American public is very upset and while Washington is getting the brunt of the blame, corporations are not far beyond in terms of negative sentiment. Banks, health insurers, big energy and others who are seen as the likely beneficiaries of the new spending freedom have seen their reputations battered in America’s widespread pushback against large institutions. From the Tea Party movement to the Move Your Money campaign to increased shareholder lawsuits and proxy challenges, the public is in a fighting mood.

Thus corporate boards and executives will need to proceed cautiously and judge how increased political contributions and activism will impact all of their stakeholders. Though the shackles are now off, the spotlight on corporate involvement in campaigns will be brighter. Profligate spending on election campaigns will be a focus for the media and online communities. Protecting corporate reputation, promoting the interests of shareholders and addressing consumer/public sentiment will all need to be weighed when companies make the decision to exercise the new rights bestowed on them by the Supreme Court.

Richard Tauberman can be reached at rtauberman@mww.com.

rtauberman General Corporate campaign finance, corporate boards, reputation, Supreme Court

I just finished reading an article about the Taliban’s PR campaign to improve its image. Now if you guessed that I was reading it in The Onion – one of my favorite places for ironic, sarcastic humor – that would make total sense. But this story actually appeared in the NYT.

My colleague Mike Sacks recently wrote about his beef with corporate apologies. And if you follow this blog, you already know mine: people who talk about public relations or communications as a solution for bad policy. The idea that the Taliban needs a PR campaign to “improve its image” is a perfect, albeit extreme, case in point. The Taliban doesn’t have a PR problem. They are the problem.

The article goes on to point out that the Taliban has issued a new code of conduct that prohibits, among other things:

• Beheadings without an investigation
• Burning down schools
• Suicide bombing of civilians

Now, I am a real believer that journalism should be balanced, and that everyone deserves a voice. But are we really having a serious discussion about the Taliban’s image and the resulting PR campaign? In the NYT?

What’s next? A positioning session to differentiate the Taliban from terrorism?

A Code of Conduct is just a piece of paper if it doesn’t live and breathe with its members, and if it isn’t reflected in the actions and decisions of the individuals. And PR isn’t a solution for bad policy, decisions or actions.

In the words of Forrest Gump, “And that’s all I have to say about that.”

Carreen Winters can be reached at cwinters@mww.com.

cwinters General Corporate code of conduct, policy, reputation

Ah, the 1982 Johnson & Johnson Tylenol recall.

The model for successful crisis communications to which we all aspire; to which a generation of crisis managers and business school professors give oblation.

The New York Times thinks so, too, comparing J&J’s recent recall woes to its standard-setting recall in the year I was born. Note: Those two events are not connected. As far as I know.

Many “analysts” the NYT spoke with seem to think J&J fumbled the ball here and didn’t live up to its brand promise. One of the world’s most trusted brands failed to repeat its proven model, they say. Perhaps this is true, as evidence surfaces showing that J&J knew of complaints about some of its over-the-counter medicines many months before the FDA issued its warning and the company initiated the recall.

But such a comparison is unfair, and propped up by a faulty foundation. What this article fails to mention is that the 1982 recall came as a result of madmen lacing Tylenol with cyanide, not J&J’s negligence. It’s much easier to “do the right thing” when reasonable people can see extenuating external forces cause the crisis in question, not poor management or specious science. In the current case, it doesn’t seem the recall was caused by any such forces.

I wonder at what point, if ever, the 1982 recall will cease to be a relevant and contemporary model of crisis communication. Will advancing technology, speed of communication, social media, and fragmented news render it an obsolete case study? Or will it continue to be mythologized and live on in perpetuity?

This is the blessing for J&J: Decades after the 1982 recall, it still reaps brand benefit for a job well done. And this is the curse: It will likely never live up to the legend again.

Mike Sacks can be reached at msacks@mww.com.

msacks Crisis Communications, General Corporate Crisis Communications, Johnson & Johnson, recall

The New York Post is reporting that Goldman Sachs is delaying its bonus announcement until after it reports earnings – and after the other big banks report theirs. The official party line is this:

“It’s important to have context of earnings before we start communicating compensation.”

Ahhhhh, the elusive but all important context.

In the area of reputation management, we talk about context, and things like benchmarking, a lot. In fact, we often counsel clients that when handling an important issue, context is king. Stakeholders need to understand what to think about your news, and how it stacks up to others, and where it fits into the bigger story of your reputation. The notion of context is pervasive and accepted — we see performance relative to peers reflected in share price valuation, teachers who grade on a curve, and even employee performance evaluations.

But in this case, the idea of waiting for context feels like a parlor trick designed to allow Goldman’s peers to take the lion’s share of public reaction to the fact that the banks are giving bonuses at all. This storm started brewing 2009 when the banks accepted TARP funds, and as coincidentally began repaying them as discussion of Wall Street bonuses in Washington heated up, in what some would describe as another parlor trick – repay the money to avoid government intervention and public backlash.

In a time when 10% of Americans are out of work, home foreclosures are at a record high and consumer fear about their economic futures is palpable, the banking industry takes great reputation risk in doling out checks to their executives.

No doubt the decision makers at Goldman are thinking that reporting good results will give them the permission – I mean context – to award those bonuses. But what they fail to recognize is that the perception by everyone except perhaps their shareholders (and presumably their bonus eligible employees) will be that those profits, in this environment, are hardly a badge of honor. Big healthcare companies will face the same dilemma and the correlating reputational risks.

Herein lies the dilemma. While our capitalistic society rewards initiative, success and profits are good (in theory) – there are certain industries that can be dinged for being too successful, and too profitable – particularly when it can be perceived as coming on the backs of the average working person on Main Street USA. So when those profits coincide with people losing their homes, foregoing their prescriptions or medical care, and an increasing number of unemployed and uninsured, the very things that can build reputation can also diminish it.

Just a generation ago, achieving home ownership was the American Dream….it is now an expectation. In America, healthcare is viewed as a right, not a privilege. When Americans find these things out of reach, it is easy to demonize the big corporate machines for “putting profits ahead of people” – regardless of the fact that the fundamental principles of our system that fuel that American Dream require it.

Noticeably absent from all of this discussion is the role that companies like Goldman Sachs and other large corporations play in creating good jobs, support community and philanthropic initiatives that would otherwise go unfunded, and improving lives. These things are true, and they are important. Just not in this context. After all, context is king.

Carreen Winters can be reached at cwinters@mww.com.

cwinters General Corporate bonuses, context, Goldman Sachs, Reputation Management

Corporate apologies after big screw-ups are a real raw nerve for me. This is because, though they rarely succeed in accomplishing what people think they should, namely engendering forgiveness and understanding and thus restoring credibility and trust, we somehow insist on them.

We insist on them, knowing we will get a heavily sanitized pseudo-apology, then declare them not good enough or too little too late. It’s a predictable pattern.

The New York Times takes on the subject in the context of today’s hearing of the Financial Crisis Inquiry Commission, with the chieftains of Wall Street appearing before it to endure another (richly deserved) public flogging and offer, as the article puts it, “the art of nuanced regret – admitting mistakes without accepting blame.”

Don’t get me wrong – these guys owe a lot of people genuine apologies to start, and some have tried, albeit they were the typically hollow, non-specific kind. It would be just one of the many right things they could do to show respect for the public that bailed them out.

But here is the key line, and communications challenge to weigh, in the story:

“Of course, corporate chieftains worry that apologies may be red meat for shareholder lawsuits.”

And they are right to worry. Winning in actual court is better than winning in public-opinion court.

In precarious times, being liked and winning favor shouldn’t be the communications short-term goal. Wall Street is never liked, even in the best of times, only tolerated. And it will return to tolerable after time and with the right moves. But facing such an overwhelming storm, the best they can hope for right now is to simply find shelter.

So the bottom line on corporate apologies? It, like most things, depends. I certainly wouldn’t say an apology is never appropriate. And I disagree with some experts who say that when people are unhappy, you should always apologize. But if you are going to apologize, do it with meaning.

In this instance, I wouldn’t recommend it as a communications counselor. But when circumstance preclude a proper apology – genuine, and light on corporate speak – you can substitute action. Do something to demonstrate your remorse, that you’ve learned and are trying to make it right, even if you can’t say so explicitly. What’s the phrase? Something about actions and words, and their respective volume. And corporate apologies are too often just words.

Mike Sacks can be reached at msacks@mww.com.

msacks Crisis Communications, Executive Visibility corporate apology, Reputation Management

When you have Paula Deen – sweet, lovable, would never steer you wrong though she might steer you towards high cholesterol- on your side, it’s easy to seem like the good guy.

So I can understand why Scripps Networks, owner of Food Network and HGTV, employed the very public hang ‘em high communications strategy it has thus far in its tussle with Cablevision over the revenue it receives from the cable provider. Full-page newspaper ads, microsites (featuring a stunned Guy Fieri’s video lament), CNBC appearances – all tactics articulating a visceral message: Scripps loves you, dear viewer, and that greedy Cablevision doesn’t want to pay the pennies it would take for us to be together.

The approach and message seems even more obvious and enticing when your opponent, a cable provider – loathed, cursed, never shows up between 10 and 7 – is already fitted for a black hat.

So far, Scripps seems to be getting a good amount of support, superficial as it is. “A mile wide and an inch deep” comes to mind. While Food Network and HGTV might have gained thousands of new fans on Facebook, that’s hardly what it will take to resolve the situation. It’s another matter to “vote with your wallet” and drop your cable provider in protest. That’s deep loyalty to Bobby, Giada, and Rachel (and whoever is on HGTV – you can tell which of these networks I watch). Because then, we’d have to switch to an equally unpalatable cable provider and waste a day waiting for the hook up. And most of us won’t do that.

But there is some danger here for Scripps, too, if they don’t consistently match the message to action.

Scripps did announce this morning it would re-air the White House Iron Chef special (complete with Michelle Obama) – that drew 7.6 million viewers last Sunday when it originally aired – on local NY and CT stations. Nice start. Unfortunately, Scripps seems to plan on accompanying this savvy gesture with on-air battle cries. Maybe just let the broadcast speak for itself.

So how can Scripps make sure this is not just a nice, though one-off, gesture to viewers? Though it might eliminate some of its perceived bargaining leverage, they could put their shows online for affected viewers to watch until this gets (hopefully) sorted out. Ads thanking network fans for their support are nice, but they don’t show you how to properly grill a duck breast or landscape your new yard.

We all know what this is – a fight between two corporate entities over money. Scripps wants the money it thinks it deserves and to preserve its value, and there is absolutely nothing wrong with that. The reputational risk comes when Scripps positions it as a noble crusade against a greedy provider to benefit the viewer, and no benefit comes. Scripps knows that if Cablevision buckles and agrees to pay the increased fee, that cost will be passed on to Cablevision subscribers.

As always, we’ll have to see how this plays out, but if I had to guess right now, while Scripps might get some deal with Cablevision, reputationally and in the long-term, it won’t come out ahead. Even worse….what if we learn that we can live without Food Network and HGTV?

Mike Sacks can be reached at msacks@mww.com.

msacks Crisis Communications, General Corporate

Today is the first business day of the New Year, and while many of the personal resolutions to eat right, exercise more or otherwise improve yourself may have already gone by the wayside, today is the day for companies and executives to begin with their proverbial clean slate.

While 2009 was by all accounts and all measures a difficult year, at least for today, 2010 is full of promise. My New Year’s wish is that we learn from the mistakes of the past, and resolve to make 2010 the year of Reputation.

Today, a colleague sent me a great article from the FT that provides some excellent food for thought about how those tasked with managing and protecting reputation can do just that. It also provides me with a new favorite quote about reputation, from none other than Abraham Lincoln:

“Character is the tree…reputation is the shadow.”

In the interest of nurturing the tree, so that it may cast a bigger, better, shadow in 2010, here are the Five Reputation Resolutions I think every company should make.

1. Get serious about digital/social media. Note that I am not calling it new media – because it just isn’t new anymore. And companies that are still waiting on the sidelines to “see how this develops” are missing one of the greatest opportunities to connect with their stakeholders and enhance their reputations. It’s cheap. It’s (relatively) easy. And it is powerful. Use of social media means changing attitudes about “controlling the message” – it is about conversation, interaction and even disagreement. If you want to “deliver a message” take out a billboard. If you want to enhance your reputation, join the conversation. Because it’s happening – with or without you.

2. Review your crisis plans, and update them to include use of social media. (See point 1). Sixty seconds is the new first hour – and the reputation you spent decades cultivating can be destroyed in a mere minute. Imagine the alternative reality if the Miracle on the Hudson had been a less than miraculous ending. The airline’s early statements (or non-statements) of awaiting confirmation were simulcast alongside photos of the aircraft floating in the water. This story took on a life of its own long before the airline got involved. All’s well that ends well, but it could have easily been a reputational disaster.

3. Engage your employees. No doubt many are reading this and thinking “check” – December and January are months loaded with employee communications largely driven by benefits elections and other year end housekeeping. But housekeeping isn’t employee engagement. The companies that make meaningful employee dialogue (at MWW Group we call that Employee Exchange™ vs. employee engagement in 2010 will be the ones who win the talent wars and own the upturn. Your employees are afraid. And that fear can create a near-paralysis of innovation. If that isn’t reason enough, consider the following: your employees are the embodiment of your reputation with every single stakeholder you have. They touch your customers, your shareholders, your partners and your communities every day. Entrust them with real information, and tell them what you need them to do, (beyond signing up for health care during open enrollment). Because if you won’t, someone else will…and that someone just might be offering them the chance to sign on for a new union, or a new job. Unemployment won’t be in the double digits forever, and the relationships you cultivate with your employees today will last far beyond 2010.

4. Appoint a CSR officer. Today. Corporate Social Responsibility is here to stay. It is a “must do” in this environment. And by CSR, I don’t mean “Going Green.” If 2009 was the year of “Green” (and greenwashing), I hope that 2010 will be the year of citizenship. Are you serious about a comprehensive approach to citizenship that includes your business practices, your community interaction, your workplace culture and policies as well as your commitment to the environment? Appointment of a CSR officer – and a reporting structure that demonstrates the importance of the function – is a clear signal of your organization’s seriousness about citizenship. And once you are doing the right things, then you can talk about them. Reputations are built, over time, by actions and demonstrations, not simply words.

5. Make the right decisions. I’ve blogged before about the importance of actually doing what is right – and then communicating about it, not the other way around. Communications is not a magic elixir to course-correct flawed strategy, perfume the bad-policy pig or otherwise compensate for errors in judgment, planning or best laid plans that have gone awry. When companies make bad choices, you can’t “spin it.” Remember, it is about the tree first…then the shadow.

Wishing everyone a happy, healthy and prosperous 2010.

Carreen Winters can be reached at cwinters@mww.com.

admin Employee Engagement, General Corporate