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12/15/2008 6:14 AM
At a time when the holiday spirit and the oncoming dawn of a new year should bring an immersion of happiness and glee to those of us with long memories, for the past 11 years we at Burson-Marsteller have been saddened with the turning of the calendar page to December 10. That was the date in 1994 – a Saturday never to be forgotten by those who experienced it – when one of the best of our best, Tom Mosser, was murdered opening a package containing an exploding bomb sent by a serial killer madman known as the Unabomber.
Tom lived almost exactly half his 50 years at Burson-Marsteller, joining us in 1970 after serving as aide to the admiral commanding the U.S. fleet in Vietnam waters. By 1983 he managed our flagship office in New York; by 1987 he managed all U.S. operations. Early in 1994, Tom went to Young & Rubicam, our then-parent company, as assistant to CEO Peter Georgescu. Nine days before his untimely death, he was named executive vice president/general manager, Y&R’s second ranking executive.
The week following Tom’s death was a time of anguished mourning across the Burson-Marsteller firmament, especially in New York. More than 600 attended his funeral in New Jersey, many asking themselves and others “why Tom?” A U.S. honor guard saluted his naval service as a lieutenant, senior grade. (A holdover from his time in the navy was that he always addressed me as “Sir” even despite my frequently pleading that my military status was that of an enlisted man). A week later, Tom’s B-M colleagues, many traveling from afar, attended a somber memorial service in a church near our office.
Tom’s career path was rocket-like. After just a few years, he was the office’s “go to/can do” person. As he began to take on responsibility, first as client leader on our first major consumer account (Burger King) and then as a group vice president, Tom was the manager most of our people wanted to have as a boss. They knew that working for Tom meant learning from a master and moving up the organizational ladder faster. They knew he was going places and they wanted to be on the ride with him, a no-nonsense leader totally dedicated to serving clients. (Once Tom was assigned to a client, it was near impossible to get them to accept any other, no matter how experienced or professional.) What was best for the company was the North Star course from which he never deviated.
There are at least two theories on why the Unabomber singled out Tom to receive his lethal package, neither ever proven. One is that he usually mailed his home-made bombs to individuals whose names or addresses included a reference to trees (the Mossers lived on Aspen Drive). The other is that of the four senior Burson-Marsteller executives in “Who’s Who,” only Tom’s listed his home address. (I have never ever forgotten that I, in terms of public visibility, would have been a more representative target.)
It is of little comfort to those of us who knew and loved Tom Mosser that the Unabomber, after a bombing spree lasting 17 years and causing three deaths and 29 injuries, many disabling, has been serving a solitary confinement lifetime sentence without probation in a Federal prison the past 10 years.
As for Tom, I believe my words at his funeral service still hold: “Tom would have wanted us to commit our energies to celebrating his life – yes, to celebrating his life – rather than to mourning his death” – difficult though it be for us who survived him.
To a person, we have for long shared the grief visited upon his family – especially at this time of the year when daylight is at its shortest.
# # #
Harold Burson
December 15, 2008 12/2/2008 7:45 AM
Until my recent two-week visit to Asia, I had never been absent from the United States on the day of a Presidential election.* I was in Hong Kong fulfilling a pre-arranged schedule that included talks with a former CEO of our Asia region (a non-American), members of our B-M/Hong Kong staff (almost exclusively Chinese) and a visit to my long-time tailor in the Mandarin Hotel. Late afternoon, I departed for Tokyo and arrived at my hotel, the New Otani, about the time election results started to come in.
The subject topmost on the minds of my Asian colleagues and friends – both in Hong Kong and Tokyo, and later in Shanghai and Beijing, centered on the election. It was obvious at each of my destinations that Barak Obama was “their” candidate and, upon knowing the election results, America seemed to have moved several notches higher in their esteem.
I think their response was based on two factors – and I am not certain which was the more compelling. The first was their near certainty that U.S. foreign policy would change, in their view for the better, in an Obama administration. They felt the U.S. would re-assume its leadership position in global institutions and initiatives and that this would be a good thing for the world. The second was their obvious pride that a “person of color” had been elected president of the United States. What I was hearing -- from non-Americans -- in those post election days was that America had, after some 230 years, fulfilled the promises set forth in its Declaration of Independence and its preamble to the Constitution. Once again, I was reminded of the genius of our Founding Fathers in establishing what our greatest president described as a a nation “by the people, of the people and for the people.”
The purpose of my Asian visit was two-fold: the most pressing was an invitation to address the International Public Relations Association (IPRA) World Congress in Beijing. I took the occasion to talk about “The Corporation, Social Responsibility and Public Relations.” In brief, I expressed my view that a corporation’s first duty is to behave appropriately and make a profit, and that if it fails in those objectives, it can never hope to be regarded as a socially responsible corporation. I also gave my description of a corporation’s chief public relations/ communications officer’s four principal duties: 1) corporate sensor (an early warning role on social or other change that can affect business); 2) corporate conscience; 3) corporate communicator; and 4) corporate monitor (to make certain that the business lives up to its commitments).**
The second reason for my visit was of a more nostalgic and ceremonial nature. This year, 2008, is the 35th anniversary of Burson-Marsteller in Asia where, in 1973, we established four offices: Hong Kong, Singapore, Kuala Lumpur and Tokyo. Since then, we have added offices in China (1985), Korea (1988), Indonesia (1995) and India (2003). India today represents our second largest staff concentration; China our third. Save one (Korea), each Burson-Marsteller office in Asia is headed by a local national and the staff in each office is near totally local nationals. It took us more than 25 years to achieve that objective.
In Beijing and Shanghai, we brought together former B-M professionals (we identify ourselves as B-Mers) who had moved on to other pursuits. About 75 showed up in Beijing, 50 in Shanghai. Old friendships were renewed, new networking opportunities were established. For most, their jobs at Burson-Marsteller was their first in public relations.
At the IPRA Congress, I renewed a friendship with a retired high ranking Chinese diplomat who spent almost ten years in the U.S. as China’s ambassador to the United Nations and then to the United States. In a one-on-one discussion about the global economic crisis, he made the cogent observation “from a political philosophy standpoint, your country is getting more like ours, and our country is getting more like yours.” I have been thinking about what he said ever since.
On a personal note, I did something I should have done years ago: I stopped to smell the roses (an admonition -- “Stop to smell the roses” – some 40 years ago from the lips of the golf great Walter Hagen). The occasion was my first visit to Kyoto, something I should have done earlier but never got around to in any of my previous 30 visits to Japan. My guide was my esteemed colleague at B-M/Tokyo, Tsuyoshi Takemura, whose early life was spent in Kyoto. The ancient capital city of Japan is in an amazing state of preservation with buildings dating back to the 8th and 11th centuries. The tour and the Bullet Train ride were worth the wait!
What is the message I want to convey with all of the above: Stop and smell the roses.
Harold Burson
December 1, 2008
* This is not a factual statement. I was also absent from the United States for my first vote in November 1944. I was in Vise, Belgium with an engineer combat group practicing Rhine River crossings on the Meuse River. I voted by absentee ballot (for Franklin D. Roosevelt).
** For a copy of this speech, click here. 10/27/2008 9:17 AM
About a dozen years ago, one of my most intelligent decisions was hiring a part-time professional archivist to preserve the historical record of a public relations firm which has thrived beyond my wildest dreams. The archive is in two parts: 1) The Burson-Marsteller Archive and 2) The Harold Burson Archive. I have made a commitment and the Boston University School of Communication has accepted that it will be the final repository of my professional and personal papers.
Knowing my interest in the current financial crisis, our archivist, Deborah Shea, of the archive specialists The Winthrop Group Inc., one day recently called to my attention a document I had written in April 1963, about an earlier financial crisis that involved public relations. It was one of a series of monthly papers I wrote for internal distribution under the general heading “on the subject of PUBLIC RELATIONS.”
The document for speaks for itself. It is as topical today as when it was written 35 years ago. One caveat: in 1963, few women were in corporate public relations. Hence, the now archaic reference to the male gender.
On the subject of PUBLIC RELATIONS
Number 14
Financial Public Relations… A Matter of Principle
A couple of weeks ago, the Securities & Exchange Commission reported to Congress on its “Special Study of the Securities Markets.” Of the initial 1600-page portion, 84 pages were devoted to activities relating to the dissemination of corporate financial information and their effect on the securities markets.
Although highlighting the sensational, the SEC report seems to be a reasonable statement of some of the public relations malpractices that have particular application to the rise and fall of stock values. Limited recognition is given to the “many” companies and their “publicity agents” who conduct their activities “with restraint and propriety.” But the over-all effect is that some few public relations practitioners have used their special positions in a manner not in the best interests of the investing community – and in a way that tends to undermine public confidence in the securities market. Another certain effect is that the report casts suspicion the public relations function itself.
EXAMPLE: One public relations firm (once well-known, now out of business) took its fee in stock. An intensive program to puff up the stock price followed. The president of the public relations firm sold his stock at a high price which he worked hard to inflate – not always by depending on facts. Soon, the price of the stock was back to where it should have been.
EXAMPLE: One public relations man distributed at least one news release fabricated totally from thin air. It reported the construction of a new plant in Europe for a client company; there was no such plant. The purpose of the release was to indicate corporate activity with the objective, assumedly, of running up the price of the stock.
Nor are public relations men the only ones cited.
EXAMPLE: The business editor of one of our leading news magazines engaged in the practice of doing articles on relatively obscure companies, making sure to buy substantial blocks (up to 20,000 shares) of the company’s stock prior to the publication of the article. Shortly after the article appeared – and the stock increased in value – he sold. He is no longer with the news magazine.
On the basis of present statutes, none of these actions seems to be illegal. SEC legislation covers the acts of brokers and underwriters; it covers corporate officers privileged to have “inside” information; it covers writers of investment advisory letters and services. But the actions of the public relations man are immune; at the present time, his own inner sense of morality, of what is right and what is wrong, is his only restraint.
The SEC report to Congress suggests “a statute providing criminal sanctions and civil liability for intentional or reckless dissemination of false and misleading statements, including forecasts unwarranted by existing circumstances.”
***
Some public relations people – ethical and honorable – are skeptical of legislation on the subject. The editor of PUBLIC RELATIONS NEWS has said the effect of such a law will be that “much valuable corporate publicity will be withheld and innocent PR directors or counsel might conceivably be jailed for having participated in releasing prognoses which seemed reasonable at the time they did so.”
No one goes out of his way to seek government regulation nowadays. On the other hand, it seems to me that some form of restraint is necessary to constrain the actions of that fraction of a percentage point always ready – in fact seeking – the angles that will produce a fast buck. At the least, I believe public relations men working in the frequently privileged financial area should be subject to the same restrictions – legal, as well as moral – as the corporate officers who are our clients.
The principle, it seems to me, is clear. The detail of specific legislation is another matter. Certainly, it is neither to our advantage as public relations people nor to the advantage of the investing public to have legislation so vague that it could bring about the result expressed in PUBLIC RELATIONS NEWS. Yet, none will disagree that someone would be able to deal with the situations cited in the SEC report. With regret, I submit self-regulation is not the answer.
***
We assist corporate management in the preparation of annual reports (for 1962, eight of them). We help prepare quarterly earnings statements and other shareholder communications throughout the year. We prepare and distribute news releases on sales and earnings, corporate acquisitions, new financing and a host of other subjects that make us privy to a company’s inner-most secrets.
We have been privileged to have this information and to work so closely with client managements for two reasons: we are, in our sphere of operations, equipped to make a contribution to corporate planning and action and, perhaps more important, we have acted in a professional manner as regards the sanctity of “inside” advance corporate information. In other words, we have lived by our own self-regulation. This we will continue to do, future legislation or not.
But for those in public relation who would do otherwise – and by their actions throw a shadow on our good name – the answer, it seems to me, is a law that would place the public relations practitioner with “inside” information on the same footing as his corporate client.
April 23, 1963
# # # # 9/11/2008 4:30 AM
My long-time friend and client at The Coca-Cola Company, Don Keough, has done all manner of executives – especially executives-to-be – a good turn by recording his common sense views in a new book mischievously titled “The Ten Commandments for Business Failure.”
Don is a Warren Buffett type guy, but that should come as no surprise. In earlier years, they lived across the street from one another in Omaha. So it’s no coincidence that Don is on the Berkshire Hathaway board while holding a full-time day job as chairman of the investment banking firm, Allen and Company, at age 81 after retiring as Coke’s president and chief operating officer 15 years ago.
Don Keough is very likely the most effective communicator I have known in business. Person-to-person and with arena-sized audiences, Don projects Eagle Scout-quality credibility even before he starts speaking. Literally, I have seen him evoke both tears and uncontrollable laughter from audiences within a 60-second time frame. As a business leader, he recognizes the importance of communications in achieving corporate goals. He taught me a long time ago that communications must extend far beyond corporate headquarters and the media – for example, to every level of the distribution chain that gets products into customer shopping carts.
Don’s most critical communications challenge, in 1985, was informing a nation of irate customers that the Coca-Cola they knew and loved, the original formula, would once again be available to them. It was his job to apologize to the American people and beg forgiveness for having deprived dedicated Coke drinkers of their favorite soft drink for eight weeks following introduction of “New Coke.” He also admitted Coke management had made a boner of the first order. Don appeared as a “talking head” in 30- and 60-second commercials that dominated TV for a full week. It worked like magic. Coca-Cola market share started increasing barely a month later.
Don has authored a gem of a book. By accenting the negative, he offers the reader forceful positive lessons on what makes a business successful.
Each of his chapters covers a “commandment” -- the first headed “Quit Taking Risks” followed by “Be Inflexible,” “Isolate Yourself,” “Assume Infallibility,” “Play the Game Close to the Foul Line,” “Don’t Take Time to Think,” “Put All Your Faith in Experts and Outside Consultants,” “Love Your Bureaucracy,” “Send Mixed Messages,” “Be Afraid of the Future” and, as an encore “Lose Your Passion for Work -- for Life.” The text is a few pages short of 200 and can be easily read in a couple evenings.
Although public relations thinking and the need for effective communications permeate the text, his “Send Mixed Messages” chapter is worth the price of the book for us public relations professionals. “At The Coca-Cola Company in the early 1970s,” he writes, “there were a number of situations where our communication was, at best, misleading, especially to our own people and our bottlers, but also to our retail customers.”
Fast-forwarding to 1981 when Roberto Goizueta and Don took over as a management team leading the company, Don writes “The first order of business was to unmix the mixed messages and convince everyone that while each sector of our global business could remain relatively autonomous, as markets had become more transnational, we had to do likewise…… The burden was on us to make sure every leader of the business from every part of the world would catch the message that our business – their business – had to change.”
Don Keough offers no easy fixes – just common sense solutions to problems any of us in business can identity with.
The moral of my choosing this topic as a subject is, simply, not as much “do yourself a favor and buy the book” as “do your boss a favor and buy one for him, too.”
# # #
PS: There’s one Don Keough story I can’t resist telling. It was at the Atlanta press conference on reverting back to the original Coca-Cola formula. Don was the Coke spokesperson and a reporter asked: “Mr. Keough, tell us the real story, wasn’t this whole episode planned in advance? You knew that taking Coke away would cause one heck of a ruckus, and you’d get loads of publicity on TV and in the newspapers about people demanding “the real thing” and finally you would cave in start again making the product you’ve made all along. Keough’s reply was classic: “We weren’t that smart,” he said, “and we weren’t that dumb.”
Disclosure: Coca-Cola is a Burson-Marsteller client. 8/26/2008 6:29 AMAnyone who skims the headlines knows that most of the world is challenged by an economy that’s losing its steam. It’s been that way for almost a year and the timing of an upturn is indeterminate, most likely not until well into next year.
The impact on public relations has been interesting – somewhat different from the dozen or so recessions Burson-Marsteller has weathered in its 55-year existence. Invariably, public relations/ communications budgets and cuts in staff were the first manifestation of rough economic goings in times past.
With the exception of the financial services and real estate/development sectors, that hasn’t happened with this recession. Of the several public relations firms with which I have discussed the subject, none has suffered reduced fee income or profits. In fact, at the current rate of activity, 2008 promises to be the best year for agencies since 2001/2002 –when the high tech bubble burst.
There seem to be several reasons for this new paradigm in the economics of public relations – over and above the intangible supposition that CEOs really believe reputation is a company’s most important asset.
The oncoming of the digital era is, I believe, the most significant factor underpinning the corporate commitment to maintain public relations budgets at present levels despite recession talk. Digital is still a “work in process” for most clients and their agencies. As an information dissemination vehicle, it has established itself; as an advertising vehicle, much remains to be learned on how best to use it.
Experimentation is taking place on how to deliver messages that are most persuasive in influencing listeners/viewers to buy one product or service over another. Clearly, the conventional full page newspaper ad or magazine spread won’t work in the new digital environment nor will the age-old dependable 30-second commercial.
Digital media present alternatives, some of the most effective at a relatively low cost. Clients and their public relations firms are deep into identifying what works – very definitely, one style doesn’t fit every foot. It’s a race no marketer can ignore – and at a time when the nature and ownership of digital content is still to be defined, public relations firms have proved to be both innovative and nimble navigating this fast-moving milieu.
A second reason is that marketers are more likely to recognize that public relations support can be effective in winning new customers and keeping those who have committed to a specific product or service. The increased use of research on how consumers make purchasing decisions has renewed interest in what we old-timers call product publicity.
A third reason for the sustained use of public relations even as the business momentum slows is that there is no longer a single unified economy for the global corporation. Even in the U.S., the economy varies by industry and by geography; the Midwest has been hard hit because of the loss of auto industry jobs while Silicon Valley, Texas and the southeast generally have had little adverse impact. Although now showing signs of a slowdown, both Europe and Asia have produced excellent profits for global corporations.
This is not to say that public relations/communications offers a guaranteed safe employment haven in a falling economy. But we can take some comfort in that we no longer seem to be a leading indicator for an economic recession.
7/18/2008 3:34 PM
On October 19, 1987 the Dow-Jones Industrial Index tumbled 508 points to 1739, a drop of 22.6 percent, the steepest ever. Five days later, Bill Schrier, Merrill Lynch CEO, in a “talking head” television commercial explained to a World Series audience why “Merrill Lynch is bullish on America.”
Soon other CEOs chimed in, proclaiming their belief in the strength of the U.S. economy and the will of American business to regain its forward momentum. It was the start of the most sustained economic boom ever.
Admittedly, the recent (and on-going) spate of precipitous write-offs by our largest, most successful and most trusted financial service institutions has deeper roots and potentially more severe consequences than the stock market plunge two decades ago.
Bad investment decisions and a failure of financial specialists to understand the ultimate consequences of newly-created financial instruments are in themselves enough to shatter the confidence of investors and the public alike.
But add to a deteriorating economic environment the ravenous appetites of today’s media for bad news and “perfect storm” and “self-fulfilling prophesy” become apt metaphors for present-day economic alarm. The unfortunate fact is that modern media – the all news television networks and the internet, especially – thrive on negative news – Gresham’s law run wild!
The pity is that our country’s resources are as bountiful as ever, our people possessed of the same skills and sense of enterprise that made our economy the most productive on the face of the earth over a relatively short time frame. Our failings are not that we lack resources, human or material; they result from bad decisions based on unrealistic economic expectations and a lack of political will and leadership in our governance process.
Business, particularly the financial services sector, perhaps more justifiably than not, will forevermore be blamed for the present economic instability. To date, the “fix” – the bail out – has been government-inspired and financed, led in large part by Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson, the latter a former CEO of the only giant banking firm to emerge whole from the recent debacle.
It is understandable that CEOs in the financial sector have not sought the public spotlight. It is true that many corporations in other businesses have failed to meet what likely are unrealistic earnings objectives imposed upon them by independent financial analysts. Companies which should have been applauded for lesser earnings than in previous periods are severely punished when they missed earnings expectations imposed on them by outsiders.
But it is puzzling that so many CEOs of major corporations are silent on the longer term expectations of business. Especially at a time when business in wide swaths of the world is, at the worst, growing at a slower rate than in years past and at a time when earnings outside the United States exceed those at home.
In the light of the importance of global business to American corporations, it is especially puzzling that business leaders are so silent in their defense of global trade, one specific instance being the trade pact with Colombia, by all measures an undisguised win-win for the United States.
In public attitude polls, business has never been so lowly regarded. There are many reasons – substantial layoffs, home foreclosures and automobile repossessions, cancelled credit cards, perceived outrageous CEO compensation, rising gasoline and household staples, mainly food, prices, higher co-pay for medical services and prescription drugs. That the “average” American family is under severe economic pressure is hardly debatable.
Which means that business must be more sensitive than ever in fashioning its behavior and communicating in a manner that, first, addresses the problems, and, second, restores confidence in the American market system that has work so well for so many for so long.
# # # # 6/12/2008 6:33 AM
You can just imagine how many e-mails and telephone calls I’ve gotten in the wake of the recent unflattering and untruthful CBS “Sunday Morning” diatribe on the behavior and characteristics of public relations professionals – and coming from a lawyer, at that.
Usually, I see “Sunday Morning” – I’ve been a fan since Charles Kuralt was its first host. I’ve been no less a loyal viewer since Charles Osgood took over. But I happened to miss the Sunday installment that featured CBS’s legal news analyst though by now I know by heart the content of his ill-tempered statement.
Never unemployed and engaged in public relations all my working life, I calculated that, in the context of his commentary, I have been lying for more than 60 years -- maybe a qualification for the Guinness Record Book.
This inference neither troubles me personally nor do I believe it harms me professionally. But I am highly irritated about what it says about the thousands of corporate executives, government officials, NGO advocates, and, perhaps most significant of all, editors and reporters with whom I have worked and shared confidences for six decades – not to speak of the millions of people around the world who have been the recipients of information I have had a hand in crafting.
I submit they’re smarter than what the CBS commentary implies. I don’t believe those with whom I have worked to disseminate my clients’ messages are so gullible (or so dumbly obliging) to be parties to the communication of lies. On the contrary, I think editors and reporters have played an important role holding public relations professionals like me to acceptable standards of fact and decency. Nor do I believe the recipients of those messages are so easily manipulated.
The grey area – as with all manner of media – is not in reporting facts. Rather, it’s in how those facts are interpreted.
Increasingly, news media are in the business of interpretation and commentary, areas once confined to the editorial page. Many if not most newsmen forget that we in public relations are not surrogates of journalists or media. Rather, we are the paid advocates of clients who have a point of view that may be questioned by affected parties. Our interpretation in serving our clients may differ from how a reporter reacts to the same set of facts. But this is nothing new in the world of journalism; editorial writers frequently have differing points of view than those expressed in a publication’s news columns.
But three score years of working in this arena have convinced me that, after all is said and done, the public gets it right. Brand names like Coca-Cola, Frito-Lay, Rolls Royce, Tiffany, Lipton, McDonald’s, Nestle, Hormel, Kraft, Budweiser, Shell and a hundred others retain their high market shares year after year because they deliver on their promise. They participate in an election every day for the customer’s vote at a time when the success rate of newly introduced competitive products is in the very low single digits.
The fact is, an individual, an organization, a product gets only one chance to lie to the public. Even in a nation of 300 million, the public early on arrives at a collective opinion – and lying over even the short run simply doesn’t work in a democratic society.
The greater lesson from the CBS incident for those of us in public relations is that it reminds us that we have done a terrible job explaining what we do. What’s the logic of claiming ethical standards when most people – including many in public relations – are unable to define the term?
Our collective failing has been in not being more specific about what we do on behalf of our clients and employers under the rubric of public relations and, more recently, communications. And making known that public relations has existed from the time humans began interacting with one another and, knowingly or not has been practiced for millennia – all the while a neutral discipline that can be used for what’s good for society and, from time to time, what’s not so good.
Given the will, there’s plenty of time to fix it – and forget about CBS “Sunday Morning.”
# # # #
3/31/2008 8:12 AM
It’s annual report time and you can be sure that many, if not most corporations, have made a special effort to report on their CSR (corporate social responsibility) initiatives, some with separate documents that highlight their actions to preserve the environment and maintain the planet’s sustainability.
CSR has, in fact, become an active subset of public relations in recent years, often touted by our trade press as a magic wand that solidifies relationships with stakeholders and brings about universal respect, maybe even affection, for the sufficiently committed corporation.
The fact is that some corporations, in the U.S. as well as Europe, recognized their responsibility as social entities before the dawn of the 20th Century. Think “mill” towns; think Hershey, Pennsylvania. Companies built livable and affordable housing, schools and medical facilities for their employees. Altruism was not the reason. They did it because it was good business. It gave them a nearby, stable and generally contented labor force. And it pointed the U.S. on the road toward creating the world’s most productive economy.
In the less complicated world in which business once did business the corporation’s role in society was relatively simple. It was to manufacture products and deliver services that were valued by its customers, provide steady jobs for employees, be a good corporate citizen in communities where it was located and compensate stockholders with a reasonable return on their investment. That, in effect, was the social compact between business and society – and it worked for many years.
Starting in the 1980s, the corporation’s primary mission veered in another direction. All one need do is look up annual reports of that era. Their avowed purpose, boldly communicated, became “maximizing shareowner investment.” Purging companies of unproductive assets (including extraneous people) became the prevailing priority. Corporate social responsibility took a back seat.
But one of this country’s wonderful characteristics is its innate ability to self-correct. This has manifested itself many times in politics, but it also happens in business. Once the pendulum sweeps too far in one direction, it begins moving counter-wise. The recent reintroduction of “corporate social responsibility” to the business lexicon is, I hope, one of those manifestations.
But let me offer a caution prompted by my recent re-reading of Charles Dicken’s satiric novel “Bleak House,” published in 1853. One of Dicken’s most memorable characters is Mrs. Jellaby. She espoused every imaginable worthy cause, her latest the plight of the natives of Boorie-goola-Gha on the left bank of the Niger. She called it her African project and it occupied her near full time.
Then Dickens tells us the state of Mrs. Jellaby’s personal and family affairs. Her house is strewn with paper and other rubbish, the furniture and floors covered with dust and grime. Her children are in a dire state of neglect, badly clothed and unfed. Her son’s head is stuck between the banister railings. But Mrs. Jellaby doesn’t seem to notice, much less care. Mrs. Jellaby is obsessed with her African project.
The lesson of Mrs. Jellaby – as I have said before in articles and speeches -- applies not only to social critics and reformers, self-appointed or otherwise. It applies also to executives who must balance the many obligations confronting the modern corporation.
A corporation’s first duty, as I see it, is to manage its affairs properly and profitably. It must, as indicated earlier, deliver products and services that fulfill the customer’s need and meet stringent tests of safety and reliability. It must compensate employees fairly and provide fulfilling career paths and a safe working environment. It must reward stockholder/owners with a satisfactory return on their investment. And, yes, it must also support schools and hospitals and cultural institutions that serve its numerous stakeholders. It should recognize that its greatest payback from its CSR investment will come from initiatives that benefit those with the closest business connection to its growth and profitability – mainly its own employees.
Corporate participation in meritorious public service undertakings – local, national or global – is, of course, to be commended. But those that gain goodwill and enhance corporate reputation most are still those with a business connection to the donor. That’s why large corporations with mega-buck philanthropy budgets employ professionals to decide where they spend their money. Charity without a business purpose is not a prudent use of stockholder funds; there must be a business purpose, a meaningful business rationale.
It’s the reason Coca-Cola is directing millions of dollars to provide water to Darfur refugees, why Exxon supports teaching engineering and sciences in colleges, why Johnson & Johnson, Pfizer, Merck and other pharmaceutical companies focus on health and disease. Coca-Cola sells water and uses it in its soft drinks; Exxon employs hundreds of engineers and scientists every year; health care and treating disease is central to pharmaceutical companies. Numerous other companies are working effectively with NGOs on initiatives in which the two parties have addressed mutual issues (McDonald’s was a pioneer with highly successful results.) In all these instances employees, customers, the public, even stockholders get the connection between corporate social responsibility and good business practice. It’s easy to understand.
What’s the point I want to make? Simply that there’s more to corporate social responsibility than do-goodism. When implemented correctly, it’s an important part of the reputation building process. It adds to the bottom line with greater sales and consumer satisfaction. It serves as a positive differentiator from competitors. It’s a form of corporate behavior we in public relations should embrace whole-heartedly.
# # #
Harold Burson
March 31, 2008
2/28/2008 8:05 AM
My only thought on how long I was going to live was that, with luck, I would make it to the biblical three score and ten. Genetically, I had a good shot: my Father fell short by two years, my Mother made it to a couple months short of 90.
Nor did I ever give much thought (really none) to retirement or what I would do after reaching the magical year of disengagement, 65, in my case, February 1986. Having joined Young & Rubicam seven years earlier, Burson-Marsteller was on the road to becoming the world’s largest public relations firm in 1983. My fellow Y&R board members asked me to stay on and I remained CEO through 1988. Jim Dowling, a colleague of 20-plus years, succeeded me. He had no interest in my departing and I stayed on with the stipulation that I wanted no part of day-to-day management, especially anything having to do with budgeting and the bottom line. It’s been that way for 20 years.
Longevity and staying on the job is not that rare in public relations. Edward L. Bernays, who literally defined public relations counseling and began its institutionalization as a business discipline, reached 103 before packing it in. My close friend and competitor John Hill was still on the payroll when he died at 85. Tim Traverse-Healy, a friend since the early 60s, is still active as one of the UK’s most respected counselors – and he’s a wee bit longer of tooth than I.
Closer to home are two long timers who, like me, started their businesses after World War II and are still active (though, also like me, no longer CEO). One is Dan Edelman, founder of the firm that nears his name; the other, David Finn, is the Finn of Ruder Finn (as a matter of fact, Bill Ruder, the Ruder of Ruder Finn, is also still active though for many years as an independent counselor). Dan, David and I were born within a year of one another, and I can never keep straight who among us is eldest and who is youngest. Al Golen of Golen Harris is still a kid; he’s not even 80.
Many with whom I come in contact – especially retired former colleagues, clients and competitors – seem curious about an octogenarian’s worthiness in a fast-moving global public relations enterprise whose median staff age is, at most, 32. Usually, the discussion starts with a polite “do you actually go to work every day?” My response is “well, I go to the office every day – unless I am traveling and that’s usually for business reasons.” (Note the subtlety of not claiming to go to work every day!)
The more difficult part of the conversation is explaining what I do at the office. (Remember that no one in the past 20 years has told me what I am supposed to do.) So, as a starter, I am available to fellow employees across the broad spectrum of Burson-Marsteller; they know that I personally answer my telephone (unless I am speaking to another caller) and that I respond (usually quickly) to e-mail messages; also, that my office door is always open. As one may expect, many of the calls are along the lines of “when did we open our Singapore office?” or ”have we ever worked for a company that builds aircraft carriers?” But some actually want my input on real-life client situations. Second, there are a few long-time clients with whom I have an ongoing relationship – though, admittedly, my role nowadays is more talk than walk. One of them is the U.S. Postal Service, a remarkable institution whose entire business is built around the concept of customer service. Two others are Coca-Cola and Merrill Lynch, with whom I have had quarter century relationships.
Another activity is what I describe as institutional and ceremonial events. In addition to banquets and the like, I attend Burson-Marsteller anniversaries and other happenings of note. Last year, for example, I was at our 30th anniversary in Oslo, our 30th anniversary in Sao Paulo, our 40th anniversary in London and, in January, the 50th anniversary of our Pittsburgh office. Usually, I make a short talk, but the most fun is renewing acquaintances with former B-M colleagues and clients, past and present. (I reckon there are some 20,000 Burson-Marsteller alumni in 35 countries).
Spending time on college campuses with public relations and journalism majors, and occasionally at graduate schools of business, is a special treat for me. I do three or four a year and usually spend a full day talking with students and facult | |