Does PR have a conscience? The news this week that Ketchum has resigned as agency for the Kremlin raises the question of whether large PR firms are engaging in some reputation management of their own. Ketchum’s work for Putin’s Russia had attracted negative coverage even before the latest Ukraine crisis and the recent murder of opposition politician Boris Nemtsov.
Earlier this year, Edelman, the top independent PR firm, announced it would no longer work for the American Petroleum Institute. The move came after the agency struggled to deflect public pressure for mega-firms to cut ties with clients who deny climate science. Edelman’s decision to spin off the ad unit that handles API work was seen as progress by some environmental groups and hailed as a “gutsy business move” by one blogger, who – in a stunning display of hyperbole – compared it to CVS’s decision to discontinue sales of cigarettes.
The response in each case may amount to an effort to protect the reputations of those involved. It’s PR for PR, so to speak. But, make no mistake, the agencies are also protecting the bottom line. If you look closely at each decision, the motives seem more practical than altruistic.
Edelman’s move, for example, simply divests the ad unit handling work for the API. And although API billings had been reported at over $300 million between 2008 and 2012, most of that was for paid media, meaning the value to the agency was probably far less. The Holmes Report notes that the client-agency relationship had “scaled back” over the past year. Edelman is surely aware that major companies like Walmart vet prospective agency partners not only for their hiring practices and other criteria, but to ensure compliance with their strict sustainability policies, so the decision may actually be a shrewd play to attract bigger fish.
Scratch the surface of Ketchum’s decision and you’ll uncover similar motives. Public documents indicate that the agency’s work for the Russian Federation had declined at the end of last year. With its economy teetering and Putin’s very regime threatened by political and fiscal pressure, Russia may be a bad risk in more ways than one. So, the time is right for a principled decision.
Public relations agencies have to stay profitable and grow just like any other business. It’s easy to be cynical about the timing here, and to criticize from a distance. Enlightened self-interest is not a crime. But, as we often counsel our clients, sometimes the right thing to do is also good for business, and not only when it’s convenient. I hope that next time I read about a top PR firm parting company with a client whose ethics or practices run counter to the public interest, it will be more about the enlightened bit and less about the agency’s own reputation.