Burson-Marsteller co-founder Harold Burson, addressing the Foundation of the PR Society last night after receiving its Paladin Award, urged corporations to return to their role of being “a social entity, a good corporate citizen, serving the needs of all stakeholders rather than concentrating on the investor to the near exclusion of all others.”
He said trust in companies has fallen to about the same level as Congress gets and it will not return to previous levels until “our publicly-traded corporations return to committing themselves to the goal that once served the greater good of the corporate constituency and our great country as well.”
The corporate mission “narrowed” in the early 1980s from being a “good citizen” to “maximizing shareowner investment,” he said.
“In the interests of improving return on investment, work forces were reduced, defined benefit pension plans were scuttled in favor of 401-K’s, philanthropic initiatives were curtailed—all in the interest of increasing earnings," he said. “Takeovers generating substantial fees and transactional costs expanded exponentially.”
Burson said the all-out quest for high earnings to satisfy Wall Street analysts was accompanied by the “extraordinary failures in the banking industry.”
PR No Longer 'Corporate Step-Child'
Earlier in his speech, Burson described four roles for today’s corporate PR officer.
--“They serve as the sensor of social change, perceiving those rumblings at the heart of society that auger good or ill for their employers. They signal the early warning. And after detecting the yearnings and stirrings, they interpret the signals for the management team.
--“They are the corporate conscience. I am not inferring that PR executives behave in ways that are either more moral or more in the public interest than fellow executives bearing other titles…but being the corporate conscience is not part of the job description of the other executives.
--“The third role is that of communicator…it is not their only role although it is an important function. Communication for almost all institutions has two main audiences, one external, the other internal. Usually most emphasis is placed on external communication—especially to the media, both traditional and digital. But, increasingly, internal communication may be even more critical.
--“Fourth role is for the chief PR officer to serve as corporate monitor. I am tempted to use the word ombudsman because I think chief PR officers should regard their position in that context. There is a constant need for monitoring corporate policies and programs to make certain they match public expectations.”
Presenting the Paladin Award, which recognizes “a heroic champion,” was Jon Iwata, senior VP, marketing and communications, IBM, who was the 2011 Paladin recipient.