Corporate watcher and thinker, Justin McMurray, takes a look at the malaise in the corporate community.
The subsequent corporate governance attacks ensured that perceptions of and confidence in big business remained at all time lows. Corporations attempted to launch a counter-offensive, however after John McFarlane, CEO of ANZ publicly lambasted his big bank counterparts for breaking their gentleman’s ‘rebuild the trust’ agreement, strong cynicism rebounded.
And although we thought it was public outcry which torpedoed so many options packages, more likely it was the fear and desperation in the PR ‘manure-dressers’ eyes which turned management off. Please, give is death, destruction and lies, and we will spin beauty, but please, please, don’t make us do the impossible, they cried as they handed back the options brief.
Helping to fuel anti-corporate thinking during this time was the concerted big business campaign against Alan Fels and the ACCC. Their main gripe – that he uses the media unfairly in his work. The sheer hypocrisy of this line, given that they used the media to deliver it, and that they actually spend millions of dollars each year on PR to effectively influence the media, was deserving of howling derision and contempt.
Then we had the HIH Commission which poured daily fuel over the burning effigy of business sentiment. Although better described as comedy, it was brilliant to see the rare condition of commissionitis, in which people feel compelled to point fingers in any direction except their own, regarding occurrences which they cannot seem to recall.
Notwithstanding these brutal combinations, corporations were able to hang on the ropes. In more recent weeks, probably due to the end of the reporting season, they have been able to avoid further blows. In fact, I would go as far as saying, they were back on their feet, and ready to hit back. Momentum had slowed, fresh days were dawning, things were looking brighter. It really was a disappointing turn of events.
And then suddenly, striding though the Pacific mist came two corporate behemoths who quickly reaffirmed everything there is to dislike about big business. The punters licked their lips and sat back to watch the fun.
First was British American Tobacco, who won their appeal against the Australian family who had originally won $700,000 damages from the company. The family bitterly spoke of BAT’s desire to make an example of them, while the BAT hacks and lawyers calmly explained that this was not about bankrupting a family, it was all about BAT being given the right of a defence in court. The fact that the operation of this right could indeed bankrupt the family was obviously just an unfortunate side effect. The line had PR spin all over it. Try to dictate the debate. Mask any bad outcomes with good intentions. Wash your hands. Done.
However this is where PR starts to get unstuck. Everyone knows that BAT understands the implications (ie setting a precedent) of being anything less than completely uncompromising. But they can’t SAY this? So everyone knows that while their lips are moving, they’re thinking something else. The golden rule – it’s not actually lying if you are merely economical with the truth. Unfortunately for them, it is a thin veil indeed.
And then there was Wal-Mart. On 11 December, The Sydney Morning Herald published a story (from The Boston Globe), describing how Wal-Mart are being sued by the family of one of their employees who died. It turns out that Wal-Mart, like many other companies, poured millions into life insurance policies in order to receive lucrative tax benefits. Of course, they also named themselves as the beneficiary so while in this case they received US$300,000 from the man’s death, the family received nothing. The article quotes a Wal-Mart spokesman. No commentary from me is required. Read it and laugh/weep:
“It is our contention that we did not benefit from the death of our associates” and “We had a considerable investment in these employees, and we were ahead if they continued to live, particularly the man in the New Hampshire case. He had been given quite a bit of training and gained experiences that cannot be duplicated without costs.”
Enough said. The punters cheer. They’re back on the ropes.