The Most Notable CEO Apologies Of 2012

The public apology has long been a staple of PR and reputation management, and this year saw a large number of C-level mea culpas. Some were mandated, while others were designed to beg forgiveness, right wrongs, or restore good will. Here’s my list of the most notable.

Picture this: Instagram is forced to backpedal after issuing a modified Terms of Service policy that many feared could “effectively transform the Web site into the world’s largest stock photo agency.” In a blog post, cofounder Kevin Systrom blamed “confusing language” and pledged not to sell users’ photos. His statement did quell one controversy, but the social media storm has raised other issues about privacy and user protections.

Pink slip-up? The saddest, and possibly most ineffectual, apology might have been that delivered by former Yahoo CEO Scott Thompson about his “resume inflation.”  The embattled chief issued a statement taking responsibility for the goof and apologizing to Yahoo employees, but without any explanation or clear way forward. It wasn’t enough; he was ousted after just four months on the job.

J.P. Morgan Chase CEO Jamie Dimon‘s apology for unprecedented trading losses was surprisingly robust for the previously untouchable banker; in “contrite” and widely publicized testimony before the Senate Banking Committee, he called the bank’s $2 billion error “embarrassing,” adding “the buck stops with me.” Dimon’s statement got mixed reviews, primarily due to his opposition to regulatory measures that many feel might have kept the bucks in the bank. The apology was articulate, yet Dimon’s credibility took a hit.

Among the most delayed and ultimately impotent apologies was that offered by Nancy Brinker, Founder and CEO of Susan G. Komen for the Cure. Brinker’s explanation of Komen’s initial decision to withhold funding from Planned Parenthood, in which she admitted that she “made some mistakes” in letting things be politicized, wasn’t enough to pacify critics, and the group’s fundraising continues to be less than healthy.

The most shocking public admission of culpability might have been delivered by Irene Dorner, president and CEO of HSBC Bank USA. Dorner testified about the lack of controls that allowed Mexican drug cartels and other illicit organizations to launder billions through HSBC’s U.S. operation. Though the misconduct predated her tenure, Dormer expressed “deep regret” for the lapses and pledged that the bank had “burned bridges” so that it could not happen again. But many were skeptical of a whitewash, given the bank’s relatively light fine, and no criminal prosecutions.

Talk about bad taste. One of the lamer apologies came from Popchips CEO Keith Belling after a video ad threatened to fry the brand’s reputation. In it, Ashton Kutcher impersonated different characters in what resembled a video dating parody. One persona was “Raj,” a Bollywood producer complete with brownface and a phony singsong meant to be an Indian accent. Many viewers thought it racist, prompting Belling to respond, “Our team worked hard to create a light-hearted parody featuring a variety of characters that was meant to provide a few laughs…. I take full responsibility and apologize to anyone we offended.” In my book, anyone who utters such a mealy-mouthed sound bite should eat his words; a half-baked apology usually makes things worse. Yet, Popchips took down the video and the food fight calmed down.

By most accounts, the Apple CEO Tim Cook’s mea culpa following its Maps debacle hit all the right notes. The full letter to customers is a masterpiece of good communications. It was swift and direct, and in the statement Cook took responsibility for the lapse and pledged to fix it. He won extra credibility by recommending that users download competitive products until such time as Apple could get it right. The apology succeeded because it reminded us how rare it is for Apple to disappoint its customers.

Jamie Dimon’s Apology Tour: Is It Enough?

JP Morgan Chase CEO Jamie Dimon’s apology to shareholders last week managed to fulfill at least three prerequisites for a public mea culpa. It was swift, it was direct, and the CEO took responsibility for the bank’s $3 billion trading loss in a hedge gone wrong.

Dimon used words like “egregious,” “sloppy,” “stupid,” and “self-inflicted.” “The buck stops with me,” was how he answered a reporter’s question after the shareholder meeting.  The words were refreshing given the recent events, which have pundits no longer worried about Too Big To Fail. It’s more like Too Complicated To Control. Which is even scarier.

And Dimon appears to have come through the worst of the crisis relatively unscathed. He survived a movement to strip him of power, and the press has treated him fairly well, considering the size of the loss.

Taking responsibility for such a blunder is riskier than it looks, which is one reason why executives so rarely face the music in a public way. It tends to increase legal liability. And in this case, it’s probably already made life easier for shareholder lawyers. They’re certain to sue, and the public apology may add fuel to the fire, raising the odds for a rich settlement.

The bank can easily withstand the trading loss, but that’s just the tip of the reputation iceberg. Not only has Dimon’s personal credibility been tarnished, but his influence on questions around financial reform is pretty well shot. His historical opposition to greater regulation, especially his reference to the bank’s trading risks as a “tempest in a teapot” less than a month before the disastrous trades, will haunt him.

Dimon’s initial response on tougher financial rules was to stay the course (“Just because we’re stupid doesn’t mean everyone else was.”) Then, he seemed to side-pedal when questioned by shareholders, maintaining that the bank supports “an awful lot” of the Volcker rule.  Huh?

There’s room for many positions here, but an essential ingredient to an effective apology is a commitment to be part of the solution, if one exists. The fence-sitting comments have reinforced the Too Complicated concerns and launched not only the lawsuits, but a federal investigation. So the public apology is just the first test. The tougher ones are yet to come.