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Internet Edition, January 22, 2003, Page 1


Saudi Aramco, the world's biggest oil company, has turned to Hill & Knowlton to devise its communications strategy. Neil Dhillon, director of H&K's PA practice, is among Washington, D.C., staffers handling the business.

The scope of H&K's engagement is said to be "indefinite," subject to termination by either party.

H&K is to be paid based on the hourly rates of staffers.

Saudi Aramco, which has 54,000 employees of which 85 percent are Saudis, traces its roots to 1933 when Saudi Arabia granted a drilling concession to Chevron. Mobil and Texaco joined Chevron as owners, until the Saudi Government bought them out in 1980. H&K's communications counsel comes as fear spreads of a big spike in energy prices triggered by the impending U.S. invasion of Iraq.

H&K, last April, signed a $77K a-month contract to offer "core communications" to Saudi Basic Industries, the largest non-energy combine in the Middle East. Its 16,000 employees market chemicals, plastics and fertilizers in more than 100 countries.

Grabs $1M India Software Biz

H&K edged Waggener Edstrom for the under $1 million account to promote India's software sector.

Nine firms pitched the business, Michael Gordon, H&K's technology practice director, told this NL.

H&K's New York, Washington, D.C., and London offices will provide a mix of high-tech PR and public affairs services to India's National Assn. of Software and Service Cos., the group representing more than 850 software and e-commerce companies.

The Indian software market has grown from $150 million in 1992 to $5.7 billion in 2000, according to India's Embassy.


Bank of America veteran Bob Wynne has been named executive VP and deputy general manager of Edelman PR Worldwide's San Francisco office, which counts Charles Schwab, Gap and Kaiser Permanente among clients.

He headed communications for BoA's global investment bank, mortgage, credit card and technology units. Wynne is credited for launching the bank's domestic partners benefits program and promoting its merger with NationsBank.

Edelman has 30 staffers in San Francisco. Nicole Russell heads the office.


Interpublic has put NFO WorldGroup, which it acquired April 2000 for $500 million in stock and the assumption of $175 million in NFO debt, on the auction block.

The company is using Goldman Sachs to "explore strategic options" for the Greenwich, Conn.-based operation that bills itself as the "largest custom market research organization in North America."
IPG added NFO to its services offerings with the idea of gathering information about customers through web-based panels.

Analysts say IPG will be hard-pressed to recover its investment in NFO due to the depressed conditions in the ad business. Bill Warmington of SunTrust Robinson Humphrey says the pending sale will lower IPG's 2003 earnings-per-share by a penny or two. He believes the deal "helps address the near-term liquidity issues facing IPG, but further underscores their severity."

IPG, which restated $181 million in earnings last year, also announced that lenders have agreed to extend the deadline for payments of various credit lines from Jan. 15 to Feb. 10. That agreement is "subject to restrictions on dividend actions and cash acquisitions," noted Warmington.


The State Dept. has suspended its ad campaign extolling Muslim life in the U.S., barely a month after propaganda czar Charlotte Beers pitched "paid media" as the best way to influence the Islamic World.

The State Dept.'s ad campaign - created in conjunction with the Council on American Muslims - was largely ridiculed by some foreign governments. State-owned TV stations in Egypt, Jordan and Lebanon banned the spots from the airwaves on the grounds that they were messages from the U.S. Government.

The State Dept. spent about $5 million to place the "Shared Values" campaign in Pakistan, Kuwait, Indonesia and Malaysia. Richard Boucher, a State Dept. spokesperson, said the campaign was intended to run through Ramadan, and was "completed successfully on schedule." He said other aspects of the Shared Values program, such as town hall meetings and speakers tours, will be carried out.

Interpublic's McCann-Erickson created the ads. Sister firm Weber Shandwick provided PR support.

Internet Edition, January 22, 2003, Page 2


Fenton Communications is handling syndicated columnist Arianna Huffington's "Detroit Project" campaign designed to depict sport utility vehicle owners as supporters of terrorism due to U.S. reliance on Middle East oil. The Washington, D.C.-based PR firm last year handled the "What Would Jesus Drive" attack on SUVs as contributors to global warming.

Huffington's goal is to "mount a citizens' ad campaign aimed at getting people to stop driving SUVs and other gas-guzzling vehicles, and jolting our leaders into taking action," according to the group's website. [Congress is considering raising fuel economy standards for SUVs, a move opposed by the Coalition for Vehicle Choice, a group coordinated by another D.C. PR firm, Strat@comm.

Diane Steed, the Strat@comm principal who directs the CVC has not been reached. She is the former National Highway Traffic Safety Administration head.]

The columnist's organization is looking for donations needed to place two ads.

Huffington said the idea for DP came after she watched for the "umpteenth time" those "outrageous drug war ads the Bush Administration has flooded the airwaves with." Those Ogilvy & Mather spots link drug use with financing terrorism.

She decided to "turn the tables and adopt the same tactics the Administration was using in the drug war to point out the much more credible link between driving SUVs and our national security."

Huffington wants to "win the hearts and minds and change the driving habits of American consumers by asking them to connect the dots and think about the effect energy wastefulness is having not just on the environment, but on our foreign policy."

The DP ads broke Jan. 12 in Detroit, Los Angeles, New York and Washington. The campaign has received coverage in The New York Times, Wall Street Journal and on NBC.


Steven Immergut, who has represented Johnson & Johnson, Bayer, Allergan and Roche, has signed on at GCI Group as group VP for its healthcare unit.

AnnaMaria DeSalva, the Bristol Myers Squibb veteran who heads the healthcare practice, cited Immergut's work with major brands, and the fact that he has lived in Latin America--which she considers key in managing global accounts--as reasons for his hire. Immergut had worked three years in Hill and Knowlton's New York and Santiago, Chile, offices. He also has been posted in Bolivia and Mexico.

Ketchum's Kristen Gorsuch is another new hire at GCI Healthcare. She handled accounts, such as Genentech, Medtronic and IBM Life Sciences, and led the Omnicom unit's biotechnology effort.


"America is being rediscovered" in the aftermath of the Sept. 11 terror attacks, Rene Mack, president of the travel marketing division of Weber Shandwick told the Hilton Head Island-Bluffton Chamber of Commerce's annual economic summit on Jan. 8.

People are traveling, but vacations are short and spontaneous, he said to the crowd of 250.

Travelers also are staying in the country, taking along family in search of a variety of activities.

Mack, whose firm does work for the chamber, believes the area could do more to promote its variety, according to The Island Packet, which covered his speech. Hilton Head (S.C.) "needs to overcome the misperception that it (offers) just one thing" such as golf, he said.

Mack cited these travel trends since Sept. 11:

--Domestic air revenue passenger miles have fallen 7.3%, while auto travel rose three percent during the first half of 2002.

Travelers now are willing to drive to destinations up to 12 hours away.

--Business travel is down nine percent, while leisure travel has climbed two percent last year, with a three percent boosth expected in 2003.

--U.S. consumers took eight percent more "in region" trips during the first half of 2002.

U.S. Chamber of Commerce chief economist Martin Regalia, who spoke spoke to the group, said the national economy is poised to emerge rebound late this year.


The best PR pros are the ones who read a lot, conduct research, and follow the news extensively.

This was the message from reporters speaking at a National Press Club program titled "PR Pros & Reporters: Friends, Enemies or a Symbiotic Relationship," in Washington, D.C., on Jan.13.

The reporters stressed how important it s for PR people pitching them to read their stories and know their beats.

Andrew Alexander, bureau chief for Cox News, said, "PR people who do their homework are invaluable."

Kevin Merida, reporter and editor for The Washington Post, said, "Know the places you are pitching. Know the departments. Know what the difference is between a business story, a metro story, a style story, and a news story. You have to be prepared."

Merida expects to be pitched. "We are in a public interest business," he said. However, he is turned off by random, anonymous pitches when he is "one of 1,500 people getting pitched."

Said Merida: "It's not going to appeal to journalists if it's a mass marketing thing."

Clarence Page, columnist for the Chicago Tribune, told the PR pros that they are where the news is happening. "You can make our job easier when you help us find good stories," he said.

The Titan Network, Atlanta, has picked up the Fris Vodka Skandia account. CEO TOny DeMartino reports the consumer and trade PR program for the Denmark-made premium vodka is in the "high six-figure range."

Internet Edition, January 22, 2003, Page 3


Publicists eagerly seek to get invitations to the Wednesday night DJ parties at the Mercer Hotel, in New York's Soho district.

The weekly parties, which feature top editors as DJs, were started earlier this year by Bridget Harrington and Nathan Ellis, who are co-owners of the Syndicate, a new PR firm that specializes in handling PR for fashion, media and entertainment clients.

A slew of top editors have been DJs, including Emil Wilbekin, editor of Vibe; Sia Michel, editor of Spin; Marvin Jarrett, editor of Nylon; Kristina Stewart, executive editor of Harper's Bazaar, and Alix Browne, senior editor of GQ.

Sally and Sarah Edwards, the London-based twins who are editor and publisher of Introducing magazine, which has recently started selling in Barnes & Noble bookstores, were scheduled to make their DJ debut Jan. 22, and Dana Brown, who is the "Vanities" editor at Vanity Fair, will be the guest DJ in February.

The parties, which are promoted via e-mail and require an invitation to attend, attract "a media-centric crowd" of anywhere between 25 to 100 people said Harrington, who noted the core of the crowd usually consists of several journalists who are colleagues and friends of the guest editor, celebrities, and publicists who are invited by her PR firm.

"The event serves as a casual and fun networking atmosphere for the city's fashion and lifestyle media," said Harrington, who worked at Nadine Johnson PR before taking a job as the marketing director of the Soho Grand Hotel. "The party is a great way for our young company to promote itself and strengthen relationships with important editors," said Harrington, whose firm is located at 302 5th ave.

Harrington and Ellis began holding DJ parties at the Soho Grand Hotel as a way to generate buzz on the hotel's lounge. The event was moved to the submercer when she left the hotel to start a PR firm. She also changed the name of the events from "Spin" to "The Subversion."

The parties have gotten mentions in The New York Post, Women's Wear Daily, Italian Vogue, and Fashion TV.


Several print outlets have gone on record in opposing the New York Stock Exchange's proposed disclosure rules for analysts.

Under the NYSE's proposed rule, analysts would be required to disclose any ties they have to companies they discuss with reporters. Such ties include investment-banking work the firm does for the companyor the analysts or ownership of any company stock.

The print media's objections are centered on a part of the proposal that would make analysts decline future interviews with publications that do not publish the disclaimers.

They view the rule as impinging on their First Amendment rights.

The New York Times and Fortune said the rule will reduce the flow of information to investors. Dow Jones, which owns The Wall Street Journal, said the proposed rule would "result in less or less-informed coverage."
The National Assn. of Securities Dealers last month dropped this rule from its proposal. "We got too much into the area of trying to regulate the media," said Howard Schloss, a spokesman for NASD.

Federal regulators have told USA Today they might be willing to modify the rules, which have applied to broadcast outlets since July, with analysts disclosing any potential conflicts in on-air interviews.

A 60-day public comment period on the proposed rules, which must be approved by the Securities and Exchange Commission, began last week.


Jodi Kantor, 27, who is New York editor of, has emerged as a leading candidate to become editor of the Sunday "Arts & Leisure" section of The New York Times.

Kantor would report to Steven Erlanger, who was named cultural news editor in October by Howell Raines, executive editor, who has given top priority to reinvigorating the paper's entertainment and arts coverage.

Raines told The New York Observer he wants the section to "break stories that our competitors have no choice but to follow...stories that are of such compelling interest that no smart reader who has the option will skip over them."

Raines said "We want to be the first on writing the story of the movie industry in its full amplitude -that is to say, artistically, financially and in terms of global culture."
He also wants to improve the section's coverage of youth culture.


The leader of the world's largest denomination, a world evangelist, and a fallen Cardinal top the list of the most sought-after interviews by religion reporters for 2003.
According to the results of the DeMoss Group Poll of Most Desired Religion Interviews, Pope John Paul II, evangelist Billy Graham, and Bernard Cardinal Law are the three individuals religion reporters would most like to interview this year.

The Atlanta-based PR firm's poll was distributed to more than 650 religion reporters from mainstream print, radio, TV, and electronic media outlets.

Three political figures were also named among those whom the reporters most want to interview this year. They are Osama bin Laden, President George W. Bush, and former President Jimmy Carter.


Teen Vogue will make its debut next week as a fashion magazine for teenage girls.

Conde Nast will publish the magazine six times this year and 10 times in 2004.

Amy Astley, former beauty director of Vogue, who is editor of TV, said the magazine will feature articles about fashion, beauty and style.

Ad rates are based on a guaranteed circulation of 450,000.

Bloomberg Personal Finance, which was started in early 1996 by Bloomberg L.P., will cease publication.

he February number is the last issue. The closing will displace 40 staffers.

Reuters said more than 225,000 financial professionals, including 80,000 in the U.S., and 100,000 in Europe, have been registered for its new instant messaging service, Reuters Messaging.

The Next American City, which will make its debut in February, will focus on the future of cities and their suburbs.

The quarterly magazine was started by Adam Gordon, 23, a specialist on affordable housing for the non-profit Baltimore Partnership, and Seth Brown, who is a manager for The Hudson Cos., a Brooklyn-based for-profit developer of low income and market rate housing.
Gordon is editor in chief and Brown is publisher.

Each issue will be centered around a single theme, but also include articles on eduction, the environment and other topics.

The advisory board includes Paul Goldberger, architecture critic of The New Yorker, and Alexander Garvin, a Yale professor and vicepresident of the agency overseeing the redevelopment of New York's World Trade Center site.

Time Inc. is testing a new home and lifestyle magazine for women called Haven.

Dee Nolan, the former editor of the British edition of InStyle, is in charge of the magazine. Kate Betts, the former editor of Harper's Bazaar, is assisting Nolan on the project.

Bloomberg TV was awarded a new license to distribute its English-language finance news and information channel on the Chinese government-run direct-to-home satellite TV platform.

CNN, which just dropped two weekend business shows-"Pinnacle" and "Business Unusual"-is expected to feature more live coverage on Saturdays and Sundays.

That could mean roundtable discussion instead of packages and live programming instead of taped shows, accoring to The Atlanta Journal-Constition.

Despite the live strategy, CNN is sticking with two weekend shows-"People in The News," produced in conjunction with People magazine, and "CNN Presents," which features in-depth documentaries.

A new Gallup poll shows 22% of those surveyed said they get their news every day from talk radio programs.

The percentage is double what it was four years ago, according to the Gallup Poll's Tuesday Briefing.

The survey also found nearly twice as many Republicans as Democrats listed talk radio as their news sources, 29% to 15%.

(Media news continued on next page)

Internet Edition, January 22, 2003, Page 4


The New York Times' revised Code of Conduct, which was issued last week, prohibits news staffers from doing PR work.

The new ethics policy also forbids all staff members from having a financial interest in an entity that they cover regularly, as a reporter or as an editor.

"It is an inherent conflict for a Times staff member to perform PR work, paid or unpaid," the paper's new ethical rules state.

Specifically, the rules say staff members may not advise individuals or organizations "how to deal successfully with the news media (though they may of course explain the paper's normal workings and steer outsiders to the appropriate Times person)."

Participation in PR workshops and surveys are also banned under the rules.

The rule says news staffers "should not take part in PR workshops that charge admission or imply privileged access to Times people, or participate in surveys asking their opinion of an organization's press relations or public image."

In addition, members of the news staff are forbidden to serve as ghost writers and co-authors for individuals who figure in coverage they provide, edit, package or supervise, or undertake such assignments for organizations that espouse a cause.

They may offer help to institutions such as their child's school, a small museum, a community charity or their house of worship.

Speaking engagements are permitted as long as "the appearance could not reasonably create an actual or apparent conflict of interest or undermine public trust in the paper's impartiality."

"Staff members should be especially sensitive to the appearance of partiality when they address groups that might figure in coverage they provide, edit, package or supervise to the sponsoring group," the code states.

Staffers may not accept invitations to speak before a single company or an industry assembly unless the Times decides the appearance is useful and will not damage the newspaper's reputation for impartiality.

The Times said staffers may accept speaking fees, honorariums, expense reimbursement and free transportation only from educational or other nonprofit groups for which lobbying and political activity are not a major focus.

If the speaking fee exceeds $2,500, the staff member must inform the associate managing editor.


The Xinhua Financial Network, a news service based in Hong Kong and partly controlled by the Chinese government, is buying a majority stake in the Asian financial news operations of Agence France-Presse.

Xinhua Financial will take over news bureaus in Hong Kong, South Korea, Singapore and eight other Asian countries operated by AFX News, the global financial news arm of Agence France-Presse, which get a minority stake in Xinhua Financial.

XFN is a unit of Xinhua News Agency, the official press outlet of the Chinese government.

XFN, which was established in 2000 in Hong Kong to provide coverage of China's markets and companies, also recently formed Xinhua PR Newswire, a $4 million venture with PR Newswire, to distribute Chinese corporate PR releases throughout Asia.

Last March, Xinhua Financial acquired Digi- Stock Korea Ltd., a financial information provider and the South Korean agent for Standard & Poor's Market Services and AFX News.


Jim Lovel, who covers the marketing beat for The Atlanta Business Chronicle, tells iCD Media's "Media Pro" column that new developments in the PR field, especially crisis management and the changing role of PR as a marketing tool, are fodder for his weekly column.

"Never make a story sound better than it really is," said Lovel, who prefers to be pitched or contacted by e-mail at [email protected].

Paul Tharp, who has been a reporter for 40 years, says the style of PR has degenerated over the years.

"It used to be a game of relationships. Now it's a game of broadcasting e-mails. It's just spam and cute, young girls making phone calls to see if you got the spam that you just deleted," Tharp, a business reporter for The New York Post, told Ben Silverman, who writes the "PR Fuel" column for

Tharp said PR people need to give story ideas to a reporter and build a relationship.


Ben Raines, a reporter for The Mobile (Ala.) Register, won the 2002 John Oakes Award for distinguished environmental journalism for his "Mercury Taints Seafood" series. He is the son of Howell Raines, executive editor of The New York Times.

Linda Hallam, previously senior interior design editor for Traditional Home magazine, was named editor-in-chief of Better Homes and Gardens Special Interest Publications.

Dominique Brooks, M.D., previously with WebMD, has joined NewsRx, in Atlanta, as senior medical editor.
Also joining NewsRx as senior medical writer is Kathleen Kite-Powell, formerly with the Centers for Disease Control & Prevention and Hoffmann-LaRoche.

Daniel Franklin was named editor of The Economist's annual publication, The World In, replacing Dudley Fishburn, who stepped down after 13 years.

Working Mother magazine has named Susan Lapinski as executive editor, and Jolie Solomon as deputy editor.

Olivia Monjo, 47, was promoted to editor-in-chief of Woman's Day special interest publications.

Mara Rubin was promoted to assistant news director at WOR-AM, in New York.

Internet Edition, January 22, 2003, Page 7


Hundreds of ideas for restoring trust in companies and the stock market were threshed over by some 60 PR/IR leaders Jan. 14 in Madison, N.J.

PR was proposed as the "catalyst" for winning support throughout a company. CEOs and boards of directors were also given lots of responsibility.
Participants said corporate leaders are needed to set examples of good behavior that the rest of corporate business can follow.

The credibility crisis in corporate America has been touched off by the scandals at Enron, Worldcom and Global Crossing as well as the dot-com bust.

These have helped trim $7.3 trillion off the stock market since March 2000, it was noted by Louis Thompson, paid president of the National Investor Relations Institute.

Also present at the "PR Coalition 2003 Summit" at Fairleigh Dickinson University were the elected head of NIRI, Don Eagon of Diebold, and the elected heads of PRSA and IABC,

Reed Byrum and Annette Martell, respectively.
Catherine Bolton, COO of PRSA, and Julie Freeman, paid president of IABC, were also present.

Besides the "big three" PR/IR groups, there were representatives from the PA Council; International PR Assn.; PRSA Counselors Academy; Arthur Page Society; Institute for PR; Women Executives in PR and its Foundation; Council of PR Firms (mostly funded by the biggest PR firms), and the Council of Communication Management.

It was undoubtedly the largest gathering ever of leaders of the major communications groups.

Murphy Chaired Meeting

James Murphy, immediate past president of Page, was chair of the meeting.

Although PR Seminar (about 150 blue chip corporate PR executives) was not represented in name, eight of the nine Page Society members listed in the program are also members of PRS.

While ethical corporate behavior was urged by some, others pointed out that CEOs had to see the effect of this on the "bottom line." But one participant said it was wrong to connect ethical behavior to profit considerations.

Another dilemma was encountered on the "transparency" or corporate disclosure issue.
Participants warned that a company cannot go public with all the facts about itself until it has been cleansed of any improper behavior.

Companies must "clean up their acts" before going public, said one participant.

PR people saw themselves as playing a "strategic" role in rebuilding corporate trust, acting as a "champion" of good practices, "building bridges" and being "facilitators."

These suggestions were made in a session on "transparency" in the morning.

Byrum and Thompson agreed that both PR and IR must play a role in increasing transparency.


O. Burtch Drake, president/CEO of the American Assn. of Advertising Agencies, said the claims made in two recent books on the ad business are "sensational-bordering on ludicrous."

Writing in the Jan. 13 issue of Advertising Age, Drake said the books-Sergio Zyman's "The End of Advertising as We Know It," and "The Fall of Advertising and Rise of PR," by Al and Laura Ries- give an untrue picture of how most ad agencies operate today.

"I readily admit that the authors, well-known marketing theorists and heads of their own marketing consultancies, make some solid points," writes Drake. "But upon close reading it's evident that the books' titles are considerably more inflammatory and negative about advertising and ad agencies than the contents themselves.

"Putting all drama and personal business agendas aside, the fact is we're not about to witness the 'end' or `fall' of anything," said Drake.

He believes the "fundamental flaw" in both booksis the authors depict an outdated model of how agencies work. "At worst they fall back on exaggerated, inaccurate industry stereotypes," said Drake, who particularly disagrees with the Rieses' statement that the "goal of advertising is not to make the product famous but to make the advertising famous."

Al Ries told this NL he believes the ad industry is "rolling out its heavy guns" because it is worried, and the idea is making progress with their customers and prospects, companies that advertise.


Aventis Pharmaceuticals has selected Burson-Marsteller to support its $100 million global ad/PR launch of Lantus, a diabetes drug. Havas' Euro RSCG Worldwide handles the ad campaign, a job it won following pitches against Omnicom's TBWA Worldwide, Interpublic's McCann-Erickson, WPP Group's Young & Rubicam and Grey Global Group's Grey Worldwide.

B-M has been handling a national educational campaign by the American Assn. of Diabetic Educators to encourage people to get checked for diabetes. Aventis is bankrolling that drive aimed at the estimated 16 million people with the disease that is the No. 6 killer in the U.S. The company has already introduced Lantus in the U.S., U.K. and Germany.

Ame Wadler is chair of B-M's U.S. health group.


John Needham has been named to the senior VP-public affairs post at Time Inc., a new position at the magazine unit of AOL Time Warner.

The 45-year-old executive, who is responsible for media, opinion leader, government, customer and industry association outreach, reports to Ann Moore, CEO of Time Inc.

Internet Edition, January 22, 2003, Page 8



The "Summit" meeting of leaders of no less than 19 PR/IR groups is a good thing for both PR and IR if the good intentions of the participants are translated into action.

The leaders of the groups worked hard all day in coming up with ideas and then subjecting them to an editing process.

They accept the fact that without support from their CEOs and boards of directors not much is going to be accomplished.

James Murphy of Accenture and the other organizers of the meeting are to be applauded for making it completely open to the press for note-taking as well as photographs.

This type of "transparency" would warm the heart of onetime AT&T PR head Arthur Page, for whom the Page Society is named.

The Page group was active in putting together this program which was chaired by Murphy, a member of Page and PR Seminar.

Since eight of the nine Page representatives at the meeting are also members of PRS, we would say that PRS was represented at the meeting as much as any of the other groups.

To underscore corporate America's commitment to openness, the private PRS should open its 2003 meeting to the press. The 175 or so members of PRS are almost all from blue chip companies.

They can't logically urge openness for their companies without practicing it themselves.

The Summit stressed that CEO and board of directors cooperation is needed in any move to restore trust.

CEOs are not going to have credibility if they continue to pay themselves 500-600 times what their average employees are making.

According to Business Week of Oct. 7, 2002, "The most egregious failing of U.S. boards is allowing astronomical pay for head honchos."

BW said boards at one time were loaded with directors looking for clients for their companies or themselves.

Such selfishness is supposed to stop under the new Sarbanes-Oxley corporate governance law but it's too early to see whether that will happen.

There are signs of competition between PR people and IR people. Lou Thompson, CEO of NIRI, sees a major role for IR in communicating with the public and communicating financials to boards of directors. PRSA president Reed Byrum told the January PR Tactics of PRSA that "about 75% of U.S. companies have simply failed to provide the public with accurate, adequate profiles of their financial health. These are basic informational offerings-balance sheets, income statements and cash flow statements. Too many IR personnel have tried to bamboozle shareholders with pro forma earnings statements."

We agree with Byrum that earnings statements and even the traditional balance sheets, statements of cash flow, etc., are a mess from a communications standpoint. Balance sheets hide more than they reveal and cash flows statements are almost impossible for a layperson to read.

All financial reports should be done with the general public in mind. Each item should be explained in plain English somewhere in the report.

CPA reports are addressed only to the "board of directors," ignoring the needs of everyone else. As we know, boards of directors are hardly the friends of investors or members of groups.

This user-hostile attitude, which permeates Wall Street, must go. If NIRI won't help do it, others must spring into action. The popular pro forma compilation called EBITDA (earnings before interest, taxes and depreciation) really stands for "Earnings Before I Tricked the Dumb Auditors," notes Fortune editorial director Geoffrey Colvin.

Both credit rating agencies (Standard & Poor's, Moody's) and "governance rating agencies" were mentioned in the 12/12/02 NIRI/PAC seminar in Washington, D.C. (1/2/03 NL). Standard & Poor's also does governance rating along with about 15 others.

Some of the governance raters charge fees to the companies they rate. Remarks by panelists Hank Boerner and Amy Goodman pertained to the governance rating services such as "The Center for Financial Research and Analysis" and the "Investors Responsibility Research Center."

Goodman called for improvement in the disclosure practices of some of the services.

Nell Minow of thecorporate, a lawyer, is the daughter of former FTC chairman Newton Minow, who famously said many years ago: "TV is a vast wasteland."

PR was defined as "inducing the public or a certain segment of the market to have a good understanding of and positive feeling about a business, person or institution" (from 94-page report on advertising and PR by Bear, Stearns in early January).

IABC, on an unaudited basis, had a loss of $6,575 for the year ended Sept. 30, 2002, according to the IABC website. As of October 31, 2002, IABC had 13,123 members including 1,130 students.

Advertisers, combating instruments that block TV commercials, are increasingly putting ad messages in show content. Latest wrinkle (1/10 New York Times) is a variety show planned for this summer in which products of Pepsi and Nokia will be part of comedy routines or visible as set props.
--Jack O'Dwyer


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