That’s the loopy rationale AIG corporate PR head Nick Ashooh had for an April 10 Time posting called “Is AIG Spending Too Much on Public Relations?” According to Ashooh, AIG needs the outside PR firms to meet the media’s insatiable demand for info. “If we stopped doing what we’re doing, there would be a worse outcry,” he told Time. That’s like a baseball manager, who just lost a game by 10 runs, saying, “At least, we didn’t lose by 20.” A blow-out is a blow-out.
AIG, which received $180B in taxpayer funds, has been rightly roasted for doling out bonuses to those executives responsible for its distress and for conducting junkets at swanky resorts. AIG’s firms are Burson-Marsteller (crisis), Sard Verbinnen (bailout statements), Kekst & Co. (asset sales to pay back loans) and Hill & Knowlton (Congressional inquiries).
Ashooh defends their work, saying it’s not as if they are doing image advertising or cooking up sponsorships. That’s not relevant. It would be laughable for AIG to launch an image campaign, now that it is a ward of the state.
This blogger understands the need for the insurer to have many arms and legs to deal with the tsunami of media/Congressional requests. Here is a tip for Nick: drop three of the firms as a goodwill sign of belt-tightening. AIG's agencies are four top-notch operations. Any one of them, especially in the current economic climate, would gladly expand its role at AIG. Nick could always bolster internal capabilities to pick up any slack.
Consolidating PR would defuse mindless blasts from Congressional critics such as Rep. Elijah Cummings, a key member of the House Oversight Committee, who called the PR payroll a “prime example of AIG misusing funds.” Wonder where Cummings' committee gets its information from AIG? Could it be from H&K or one of the other ridiculed firms that AIG uses? Cummings also said “all of the PR firms in the world will not distract us from getting to the bottom of what is really going on at AIG and how the company is spending taxpayer dollars.”
The good Congressman and others need to be educated on the information-processing rather than the “cover-up” role that PR plays at AIG. Simplicity spurs openness and transparency, traits that are needed to rebuild the country’s financial infrastructure.
Ashooh could do AIG and the country a service by simplifying his PR line-up. Rather than a silly debate over PR, AIG needs to aggressively move to fix its financial problems.
Get rid of three big distractions, Nick.
(Image via MPR)