Public opinion takes centre stage in Cyprus banks' levy

The initial announcement by the European Bank and also the IMF of the rescue of the Cyprus banking system which included measures to take a percentage from all customers accounts above and below 100,000 euros did seem particularly inept.  Banks picking on the small customer and taking hard earned cash from their accounts after all the bailing out of European banks by European taxpayers did seem an extraordinary own-goal.

Certainly that was what the media thought and a media firestorm followed starting on Friday and going over the weekend.   Even the UK's Financial Times expressed strong concerns as well as the BBC's Robert Peston, a highly influential financial commentator, highlighting that it went against more recent financial developments of protecting small investors across Europe.  Round the world the story has played to a continuing media agenda that Europe is not properly sorted out, just the type of headlines which Europe and the EU have been working hard to move on from.

How did it happen?  It certainly suggests there was no insight of the impact of the story on local, international media and in turn wider public opinion. Interestingly it appeared that there was no announcement made on the ECB web site suggesting a lack of insight over its significance or it was seen as a technical event not with wider significance requiring PR input.   Today's FT highlights how damaging it has become to European banking raising serious questions about protection for small savers across the EU with one banker saying “This is a totally crazy decision,” said one European bank chief. “This is the biggest policy mistake that the [European Central Bank] has subscribed to.” 

The story is also rather a good example of the impact of generalised public opinion on events which in this case is or has the potential to be a crisis event.  Public opinion fanned by intensive media coverage some of its hostile to Europe along with market concerns is now forcing the authorities to react.  Pictures of citizens queuing up to take money out of a bank carries considerable power and understandably banks in Cyprus are now closed till Thursday.  Were the interests of ordinary citizens put beneath the interests of key stakeholders such as Russian large account holders, the major banks and bondholders?   Was there any consideration of wider public sphere discussions as certainly the ECB were setting a terrible precedent and we can thank public opinion and the media for ensuring that a more considered position on ordinary savers deposit accounts will finally evolve.  Inge Jensen says in her excellent paper on emerging functions of the public sphere (2001) that "essential aspect of public relations (is) concerned with issues and values which are considered publicly relevant, which means relating to the public sphere."  This dimension appeared to be missing from the discussions last week at the ECB.

Coca-Cola and obesity - 2

Coca Cola has responded to the major Financial Times article from Friday, covered in my last blog, with a letter yesterday from the Senior VP of Public Affairs and Communications.  It is a well-judged message of collaboration and Coca-Cola's intent to be part of society's response to the issue of obesity.

However having discussed the original article in the MA PR Consumer and Celebrity lecture with the students, one aspect comes out.  The fast food outlets and large branded restaurant chains encourage staff to get customers to consume more Coca-Cola.   Glasses are large and are refilled automatically when half full.  It is this culture of consumption which Coca-Cola's sales operation must be behind with incentives for scale of consumption by these chains which needs to be addressed.   Just as the drinks industry is having to get rid of incentives to binge drinking; so Coca-Cola and other soft drinks companies need to follow a similar path of reducing excessive consumption.  That is an action which can be taken now by Coca-Cola.

The issue of Coca-Cola and obesity is an example where new thinking and wider stakeholder perspectives in particular need to be part of the discussions and input at a senior level in major consumer brands.

Coca Cola and obesity - is it a crisis event?

Reading the very good Handbook of Crisis Communications (Coombs and Holladay, 2012) and several definitions of a crisis event suggest that Coca Cola's developing problems with obesity and the threat of growing regulation in the USA, also discussed in last week's Financial Times, could be termed a crisis event.   Coombs citing Hearit (p.30) says that a "crisis is a threat to an organisation's social legitimacy.." and it could be considered in that context.   Also Benoit's image restoration theory (p.31) says that a crisis has two elements - an offensive act and an accusation of responsibility; both approaches could be seen to apply to Coca Cola.

(Source:http://www.nickcampos.com/2011/10/)

Certainly looking at the views and comments on YouTube ( Coca Cola's communications on the subject and opponents.)  and also now in the medical media and it does appear to be an issue with significant and growing public resonance.  As an issue this has grown relatively quickly and you can understand Coca Cola being wrong footed but a defence of large portions which appears to be part of Coca Cola's strategy is not a sustainable position.  It would be interesting to know if Coca Cola's approach to the issue is based on a crisis communications strategy and slow retreat.

From a consumer PR perspective, it does highlight that influential consumer brands are facing a growing range of stakeholder agendas.  

Cameron's speech on Europe pre-releases extracts set to raise pressure

The pre-release strategy of the Prime Minister's media team for his major speech on Europe with extracts made available to the media Thursday evening, makes clear how far the Conservatives have moved on Europe.  Bloomberg's, BBC and Le Figaro online coverage suggest that an exit from the EU is a very real possibility if the Conservatives win the next election.  Extracts of the speech released early are widely available online.  The Prime Minister was due to make the speech this evening in Amsterdam but it was cancelled due to events in Algeria.

Releasing extracts prior to the speech was clearly a decision taken after they knew that the speech would be postponed till next week as they wanted to dominate the agenda for the weekend's media, I assume.   The choice of extracts is fairly stark and will raise concerns as they suggest the speech is more negative on the EU than earlier briefings to the media which suggested that Cameron is determined to keep the UK in the EU.   I assume that the way the media would interpret the extracts was considered and so the choice of extracts was deliberate.  Could it be that the extracts are more extreme and the final speech will be more pro-EU - we shall see, but it will certainly raise international and business concerns.

Certainly the impression in international media, growing concerns in the USA government and UK business even some UK media is that the UK has taken leave of its senses over the whole issue.  What price will UK plc pay over this process in the short, medium and long term?

Blogging and Twitter brings new perspectives on HP and Autonomy

An astonishing amount of information is coming to the surface in the light of HP's remarkable write-off of $8bn of the $11bn purchase price of the British software company Autonomy.  Just following the story today via Twitter and I can see that Twitter combined with blogging has become a major new additional information source for these complex business events where you are trying to understand what is going on and wanting more information than provided by traditional media sources.

This would not have happened five years ago in the corporate sector, I would suggest, and is an important development for the corporate PR sector to consider particularly with personal and organisational reputations at stake.

Some of the detailed insights on Autonomy which I have found include:

* Oracle's remarkably aggressive and disparaging press release at the time of HP's purchase of Autonomy.  You have to admire the slides!
* View of Bronte Capital on Autonomy's accounts.
* FT Alphaville news feed last year on Autonomy.
* Jeff Matthews blog on HP's analyst session yesterday.

All of these and other media coverage, of course, feed into the Twitter conversation.

Communications and soft power

An interesting example of the growing influence of communications in soft power agendas and roles. A new job advertised at the Home Office which I spotted today in The Times.  Some of the wording is fascinating and the new communications role requires the person to "respond to the ideological challenges of terrorism."  PR as discourse.   A cynic might say that the job's requirement also includes keeping public support for funding for anti-terrorism in the public eye.  

Culture goes mainstream in PR

The Melbourne Mandate, the follow-on vision agenda for PR from the Stockholm Accords places "culture" at the heart of what it calls the "communicative organisation".  This is an important
development for PR as it acknowledges the very real influence that organisational culture has on the communications process alongside the wider cultural context in which the organisation is sited.

The communicative organisation
as envisaged by Melbourne Mandate, 2012.

The Mandate comes at a time when cultural factors are very much to the fore in recent major reports. For example, a report on the Bank of England published today focuses on cultural factors notably a very powerful Governor as a significant factor in its organisational response to financial crisis in 2008. While the culture at the major investment bank, Barclays has also been heavily criticised.

The growing prominence given to culture by the Melbourne Mandate highlights that internal communications is an increasingly influential aspect of corporate communications as the recent European Communications Monitor highlights.

Finally, the adoption of "culture" as a term at the heart of PR practice, also draws on the work of the http://www.sciencedirect.com/science/journal/03638111academic community over the last 15 years with academics such as Sriramesh and Jacquie L'Etang notable in this respect. The latest issue of Public Relations Review looks to be an important primer in this respect.