Tags: Corporate governance, Monitoring & Accountability
Read a guest blog from Francis Ingham, PRCA's Director General.
Every recession throws the importance of ethics into sharp question. That’s just a fact. And right now, we face the biggest recession that anyone alive can imagine - an unthinkable state of affairs just a few months ago, very sadly, that’s a fact too. So where does that leave us as businesses and as society?
The industry that my organisation represents expects a trough of a 30% recession, followed by a bounce back which by April of next year will mitigate roughly half of that loss. And I see those numbers in a global rather than a UK perspective. Anyone who predicts a V-shaped recession is either inspired or delusional - we shall see which. If they’re right and I’m wrong, I take my hat off to them.
The consequence of this is that there will be an inevitable pressure on ethical standards. People and companies will chase money. I don’t criticise that - it’s a natural and human reaction. We just need to understand what that reaction means.
In recent years, I’ve said frequently that there has been a consumer shift. Normal people - and I use the word ‘normal’ as a compliment: the people who have normal lives and don’t obsess about social media corporate content - have changed their expectations. They expect different attitudes and they expect better attitudes. They expect companies to pursue profits. But simultaneously to pursue purpose.
So to my mind, we have reached a very interesting inflexion point.
There are two competing magnets pulling businesses in two competing directions. In a downturn, every penny or cent matters. It defines how many people you can keep on; the returns you can offer to investors; your profitability; your own personal lifestyle as a CEO frankly. But now, there is also the second magnet: your customers and stakeholders expect more of you. Better of you. And that’s the big shift.
So here’s my take.
The most valuable asset a company has today is its reputation. I shan’t fingerpoint, but we’ve all seen the companies that have handled this crisis well - and those that have committed kamikaze in the pursuit of quick money.
The way in which that reputation is judged has never been harsher or more forensic. Norms have moved. And companies need to move accordingly.
So here’s my summary.
Take your eyes off the bottom line just for a moment - believe me, it matters. But right now other things matter more. Swing your eyes to the reputational line as well. Because the world has moved on. And in the competition for who survives and who doesn’t, reputation now matters at least as much as money.
Disclaimer: the views and opinions expressed here are those of the author and do not necessarily reflect the official policy or position of the IBE.
Author
Francis Ingham MPRCA
Director General , Public Relations and Communications Association (PRCA)
For the past twelve years, Francis Ingham has been Director General of the Public Relations and Communications Association (PRCA), operating out of London, Singapore, Dubai, and Buenos Aires; for the past seven years, has also held the position of Chief Executive of the International Communications Consultancy Organisation (ICCO), operating in 66 countries; since 2018, he has been Executive Director of LGComms.
Representing over 35,000 practitioners, the PRCA is the largest PR professional body in the world. ICCO is the voice of international public relations consultancies. Its membership comprises 41 national trade associations, collectively representing over 3,000 PR firms. LGComms represents public relations practitioners in UK local government.
He sits on the UK Government Communication Service Strategy and Evaluation Council, and the Cabinet Office Covid-19 Communications Campaign Advisory Group; and undertook the Cabinet Office communication review of the Department of Health in 2014. He is a Visiting Professor at the American University at Richmond, and was a Lecturer at the University of Westminster.
Ingham’s background is in politics and public affairs, having previously worked for the Conservative Party and the Confederation of British Industry.
He was educated at Oxford University, where he read Politics, Philosophy and Economics.