Friday, 13 Dec 2019

'I expect CEOs to stand up and speak on the issues of the day'

Richard Edelman is on a mission to get company bosses on the record about social issues. Write a blog, post a tweet, record a TikTok. Whatever it takes to register your stance on a moral or ethical issue of the day.

The era of CEOs staying silent on matters of public discussion is fading, says Edelman, who runs the world’s biggest stand-alone PR company.

His firm’s annual ‘Trust Barometer’ survey appears to back this up, with 56pc of respondents saying they have no respect for a company boss who remains aloof from their customers’ pressing issues of the day.

Edelman knows a thing or two about corporate public image. He is the second generation of Edelmans telling big companies how to survive in the fickle world of public opinion.

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Originally Chicago-based, Edelman now has offices in dozens of countries and last year pulled in global revenues of €804m.

In Dublin, with an office that Edelman says he has marked for a key new European role, the business has a team of about 40.

The group’s main business is in public relations: advising other companies on how to manage their message and how to stay on top of ‘narratives’, including play books on getting out of reputational scrapes.

When I sit down with him on the fringes of the Web Summit in Lisbon, where he is one of the main speakers, I can think of a few examples of high-profile people who might benefit from his advice.

What, for example, would Edelman say to the era’s most famous (or, perhaps, infamous) CEO, Mark Zuckerberg?

The Facebook founder has taken a pounding recently over his company’s stance that political ads on its social platforms must be allowed the freedom to stray into falsehood as a proof of independent, free speech.

What would the world’s most notable PR man tell the world’s most under-siege tech boss?

“I think he’s taken the initiative and he’s put it on himself, which is smart,” says Edelman, after a pause.

“He’s exhibiting CEO leadership. He’s also made a very strong case for freedom of expression and the ability of consumers to differentiate between falsehoods and truth.

“His testimony in Congress and his speech at the [Washington area university] were both stirring calls.

“He made the case that Facebook wants to be the place where people can express their opinions.”

This seems like a controversial reinforcement position to take. Zuckerberg has been panned for both the style and substance of his university speech, even from some allies.

But Edelman thinks it is easy to shout at, or about, a figure like Zuckerberg from the sidelines.

The main point, he says, is that Zuckerberg has taken a position, made the case that it is a principled one, and has stuck to his guns. The fact that it is against a wave of criticism and opposition is not necessarily a negative thing.

“Bear in mind that he’s one year out from the election,” says Edelman. “They’ve clearly made their decision about policy and he’s giving a backdrop to it.

“And, you know, he’s the founder. He’s the man. This is what founders do.

“They stand their ground and they establish their credibility, based on their passion and their conviction that they have done right.”

Even at the risk of offending some of your customers? Even knowing that you might be taking on a public persona, hailed as a hero by some and a villain by others?

Examples of this abound, from Marc Benioff taking high-profile positions on withdrawing services for US-Mexican border operations, to the controversial Christian views of the owner of US fast-food chain Chick-Fil-A.

Edelman’s take on this is that staying disengaged is increasingly not an option; that the way in which a CEO’s position is received outside the company may even be described as incidental.

The issue, he posits, is really more one of staff morale and retention.

“I think the core constituency is actually the employees,” he says. “Our Trust Barometer shows clearly that the new ‘most trusted institution’ is the employer, not government. So employees will only work for companies where they feel that the values are equivalent to their own.”

Millennials and so-called Generation Z workers are flexing their ethical muscles, he says. And CEOs cannot really ignore their sensitivities if they want skilled staff.

“Look, when I went to work 40 years ago, all I cared about was salary and advancement,” he says. “Now, it’s more a case of ‘I want to be listened to’ and ‘I want to have shared values’.

“Employees are saying that they want the company to aspire to something and to have a purpose.

“In an economy where you’re short of people, the employees actually now have power. When employees walk out at certain companies, because those companies are working on projects for the federal government, or something that they don’t like, that tells you everything.”

But does this mean that CEOs absolutely have to opine on big issues? Can’t they just keep their heads down and let others take a lead? Or just put out a bland statement about ‘respecting everyone’s values’ or ‘working with all stakeholders to ensure a just future’?

Apparently not, says Edelman. “I expect CEOs to stand up and speak on the issues of the day and not wait for government,” he says. “CEOs can’t be putting their finger up and seeing which way the wind is blowing.

“You have to decide and you have to speak. The new normal for CEOs is to opt for participation instead of the so-called ‘no-risk’ play, which is to not say anything.

“Because, otherwise, you’re going to be seen simply as a guy working for Wall Street. And that’s not what the job is any more. You’ve got a stakeholder world, not a shareholder world.”

What Edelman thinks is relevant. Globally, the company’s clients include firms like HP, KFC, Unilever, Heineken, LinkedIn and Adobe.

In Ireland, Edelman has a mixture of clients from multinationals such as Novartis and Coca-Cola, to homegrown enterprises such as Irish Distillers and Siro.

Edelman says that he has big plans for the Dublin operation. The Irish office, he says, is being used as a programme launchpad for other European and Asian sites.

“Dublin has become one of these unbelievable kinds of experiments in the future of Edelman,” he says.

“This is because it combines classic reputation management and public affairs with brands and digital. And this is from a team of 50 people who are on fire. I’m very proud of those guys.”

Proud enough that he is sending some of them out as PR missionaries.

“We are making Dublin the example for smaller offices in Europe,” he says. “The Dublin guys are going to Madrid, Milan, Vietnam and other parts. They’re going to show how, with a team of 50, you can actually be liberated to create the kind of programmes I mentioned because you don’t have such big verticals.”

He name-checks one of the Irish Edelman executives, “a young guy, Feargal [Purcell, head of public affairs]”, for some of the work done with financial institutions.

Part of Edelman’s company’s job is to manage media campaigns and react to occasionally hostile receptions from journalists. But Edelman knows that the shape, breadth and depth of the media is changing radically. On his weekly blog, he has made some predictions of winners and losers.

“It has to be a different business model with conferences and other things,” he says.

But the media’s business model is “broken”, he thinks, partly because of the cultural divide now occurring.

“It’s right thought bubble or left thought bubble,” he says. “And you only read what you agree with, reinforcing your opinions. And you’re only friends with those who you agree with. And so the media, in order to have a business model, seems to migrate right or left. Fox or MSNBC.”

Does he think there are still too many newspapers?

“There are never too many newspapers,” he says. “There are now too few, with too few reporters.

“In the US, I think there are less than half as many people in local newspapers. I mean, the main Cleveland newspaper has 30 in total. That’s a hopeless business proposition. You can’t cover Cleveland with that.

“So who’s going to fill in? I look at my own behaviour when I wake up in the morning. I’m looking at Axios and Politico and things that are ‘verticals’, as well as the ‘FT’ and the ‘Wall Street Journal’, the ‘New York Times’ and Bloomberg.”

As for the structural future for his own company, Edelman says that it looks a little like its past.

“It’s going to stay a family business,” he says. “I have one kid in the business. The second one’s in business school and the third one is going to business school and will hopefully come in. So maybe I’ll have three to carry on for me.”

And working with your close family members all the time?

“It’s the greatest thrill ever. I mean, I took my daughter to a meeting with the Spanish government the other day.

“She’s 24 and her eyes were as big as saucers. And I did the same with my dad when I was 24.

“What a privilege it is to pass it along and give them the same hunger and ambition. I know that they’ll change the company in the same way that I did for my dad.”

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