The Economist has PR pros aghast with its current “Schumpeter” column called “Why companies should worry less about their reputations.”

Blasphemy, they scream.

economistThe piece takes aim at those who believe reputation is a “strategic asset” that can be “leveraged” to gain a “competitive advantage,” a “safety buffer” that can be called upon to protect you against “negative news” and a “stock of organizational equity” that can be increased by “engaging with the stakeholder community.”

Schumpeter writes “reputation management industry” is “divided by PR specialists (who want to put the best possible spin on the news) and corporate social responsibility types (who want the company to improve the world and be thanked for it.”). Ouch!

The key flaw of the piece: “The second objection [to reputation management] is that the industry depends on a naïve view of the power of reputation: that companies with positive reputations will find it easier to attract customers and survive crises.”

By going to that extreme, the Economist loses it. No PR pro in his right mind ever believed that “BP’s expensive 'petroleum campaign' would deflect the jeers after the oil spill in the Gulf of Mexico.”

There may have been a feeling that BP would be more likely to do the right thing than ExxonMobil, which fought tooth and nail against the Valdez oil spill settlement. In the end, actions always speak louder than words. BP can purchase all the image ads in the world, but a long-term commitment to Gulf clean-up is the only way for it to recover from the disaster.

The Economist implies that reputation management is some sort of magic wand that can fix anything. I’ve never met a PR person (other than the fictional lobbyist in Christopher Buckley’s classic “Thank You for Smoking” novel) who viewed reputation management as a tool to help “tobacco companies that make vast profits despite their awful reputation.” The cardinal rule of crisis management is you can’t make a silk purse from a sow’s ear.

I admire the Economist’s traditional cheeky take on politics and business. Its blast at PR, however, reveals that the magazine has a poor understanding of how the profession works. With all other things equal, a company with a good reputation will win the day over a competitor.