Richard S. Levick, Esq.
the book and movie Love Story that was popular around thirty-five
years ago? There was a famous line from that story: "Love is never
having to say you're sorry."
Of all the dumb things that
were said in the 1960s, that was certainly one of the dumbest.
Shrewder advice, from our
political pundits, reminds us that the American people tend to err on the
side of forgiving transgressors. In fact, apologies can be tactical
weapons that actually increase the popularity of the accused. It's the
lesson of the "Checkers" speech, but let's be careful in our
generalizations. Apologizing requires strategic thinking. It requires art.
Richard Nixon practiced it
well in 1952. Ten years later, John Kennedy took full responsibility for
the Bay of Pigs, even though he could have truthfully blamed it, in large
part, on screw-ups by the previous administration. But he apologized
effectively, and his popularity numbers shot up.
Four decades later, Bill
Clinton was harder pressed. His apology, woodenly delivered (especially
for him), was in-effective because he had already directly lied. He lied
both off TV (the perjury that got him impeached) and, equally devastating,
on TV ("I did not have sex with ...").
The widespread perception was
that he was apologizing because he had run out of options.
the art of public repentance to business, with an eye to the ongoing
corporate scandals, and the process is just as dicey. If anything, the
contingencies are more complicated and often more dangerous. Jobs are at
stake. Brands are at risk.
And, there are legal
strategies in place. Will a corporate mea culpa undermine those
strategies, increasing exposure in multiple venues long after the public
apology is forgotten? Will a corporate mea culpa land an executive or two
in prison who might not have to go to prison otherwise?
No doubt about it, your
clients should definitely talk to you before they apologize for anything.
That said, corporations are
well advised to understand how, if properly managed, an apology for past
mistakes can in so many instances roll back tidal waves of unfavorable
testimony in the court of public opinion. But take a lesson from our
wayward Presidents. Strength and consistency are the initial keys to
effective public penitence.
In 1952, Nixon may have been
apologizing, but he looked like a man who believed in himself withal. He
reaffirmed his value to the community even as he regretted not being quite
as clean as Ike's now-proverbial hound's tooth.
Today, by contrast, the
tobacco companies find themselves in the same spot Clinton was in during
his scandal. The public is lukewarm in their response to the current
anti-smoking messages and related shows of corporate good citizenship
because these folks staunchly resisted such messages for decades.
To achieve consistency,
corporations must engage in formal crisis planning. As part of that
planning, spokespersons are to be assigned; the fewer the better, and
preferably including the CEO. Having a trained spokesperson is especially
important when the company is apologizing for a mistake. You can't have
bunches of people going around saying "I'm sorry" in public. The
content and tone of the apology has to be a lot more strictly controlled
And there's a final, powerful
reason to pick the best spokesperson/apologist. The public doesn't forgive
corporations. What do they care about the alphabet soup of power: IBM or
NCR or AT&T or IT&T? But they do care about people. It's people
they're eager to forgive. No matter how high and mighty, whether you're
the Secretary of Defense or a CEO, being human personalizes the
relationship with public jurors and improves your odds.
extent to which it is efficacious to assume responsibility (and, if
necessary, blame) becomes significantly apparent when we take a look at
your corporate clients' toughest audience: their major shareholders and
the analysts who guide them. With a billion here or there at stake, these
folks are less likely to be impressed by even the glibbest C-Suite's most
artful mea culpa.
On the other hand, an article
in the Wall Street Journal ("Corporate Mea Culpas Shown to
Pay," by Jane J. Kim, April 21, 2004) reports on a forthcoming study
that, in fact, provides powerful evidence that-if apologies play well on
the front page of the Daily News-they are also communications tools
positively affecting the headier deliberations of institutional investors.
Co-authored by professors
Fiona Lee of the University of Michigan Business School, Christopher
Peterson of the University of Michigan, and Larissa Tiedens of the
Stanford Graduate School of Business, the study shows that the stock
prices of companies that took responsibility for their own poor financial
performances outperformed the shares of companies that, instead, blamed
someone or something else.
performance" may be a different kind of problem than polluting Alaska
or dishonestly characterizing debt and equity in financial reports, but
the communications issue is still the same. You've got something that's
bad on your plate and there are powerful forces in the community that, for
whatever reason, are going to be very, very concerned.
The report collected data on
14 companies from 1975 to 1995 and found that, as the Journal put it,
"Shares of the companies that took on the most blame for negative
outcomes out-performed the shares of firms that laid the most blame on
external factors-such as the government, trade policies, the economy, or
inflation-by about 14 percent to 19 percent."
Such a handsome return on an
"honesty-is-the-best-policy" approach confirms the advice that
the best PR counselors have long been giving corporate America-you just
cannot spin your way out of a corner. Or, to put it another way, the best
spin is no spin.
Medium Is the Message
the dynamics of apologizing and winning forgiveness from the general
public are complex, we suspect that, with the investment community, there
are additional strategic factors to consider in the pursuit of effective
One complicating factor may be
the longevity and history of your client's current management team. Here,
in fact, we might need to qualify the conclusions of the Michigan/Stanford
study. A new management team is in a very advantageous position. They can
assume blame even though everyone knows they're not really to blame,
because they simply were not in power during the fiscal year when things
At the same time, they are
presenting a solution, a formal plan to ensure better performance. The new
team is perceived to be (a) not culpable, yet (b) willing to assume
responsibility for prior culpability, and, therefore, (c) they've learned
the lessons of past failures, so it now looks as if (d) the company is
optimally positioned to correct the problems.
Assumption of blame, even
somebody else's blame, thus invests the leadership message with an
evangelical credibility. No one preaches like the converted. The
unqualified assumption of responsibility for past mistakes by present
management at companies like, say, WorldCom sends a clear message that,
because the company has learned so much from its own mistakes, you're not
going to find a better financial reporting system anywhere than at
Shareholders, to be sure, like
those kinds of messages. Here too, the penitent winds up in better shape,
in terms of the perceptions of key constituents, than if there had never
been a failure or a transgression in the first place. Rising stock prices
can then cover a multitude of future sins. (Returning to our political
examples, Mr. Clinton's mea culpa did finally allow him to survive, but
mainly because the economy-the politician's decisive stock index-was still
The art of the mea culpa may, finally, be a more potent weapon in Investor
Relations than in any other communications sector, for a simple profound
Companies that assume blame,
and apologize, are sending a potent message that, unlike Enron or Adelphia,
they can afford to tell the truth and take the heat. The medium thus
becomes the message. Maybe shareholders won't even read or care about the
specifics of the apology. The very fact that the apology was made, that it
could be made, confirms for them the intrinsic value and viability of
It's the same with all public
relations initiatives, whether the company is apologizing for mistakes or
celebrating triumphs. On a long-term basis, you simply cannot sustain a PR
program without legitimate facts. For companies creaking toward
obsolescence, or destined to bemire themselves in new rounds of scandal,
spin is a bandage, but the bleeding won't stop.
By contrast, take a look at
companies that have successfully grown their public relations activities
over two or three decades. Again, investors may not even need to know what
those activities specifically are. The very fact that the activities exist
to the extent that they do should reinforce their confidence.
S. Levick, Esq. is President of Levick
Strategic Communications, which has handled the media on the highest
profile matters, from Enron and Napster to the Florida election recount
and the Catholic Church controversy. Their new book, Stop the Presses:
The Litigation PR Desk Reference, is available free by emailing firstname.lastname@example.org.
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