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Reduce, Research and Reckon with Risk Pat Gaudin FCIPR Chartered Practitioner December 2011.

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Presentation on theme: "Reduce, Research and Reckon with Risk Pat Gaudin FCIPR Chartered Practitioner December 2011."— Presentation transcript:

1 Reduce, Research and Reckon with Risk Pat Gaudin FCIPR Chartered Practitioner December 2011

2 Relationships  PR is about building and maintaining relationships  From your own experience what is key to successful relationships?

3 Trust  reliability, confidence, integrity, honesty, trustworthy  Being ethical and professional is core to having a good reputation Gregory 2009

4 A Romp  Trust  CSR  Risk  News media  Reputation  Relationships

5 Trust Trust is the cement in the relationship between institutions and civil society. When trust breaks down, civil society either withdraws from participation or expresses protest outside the mainstream channels of participation Greenwood (2003:49)

6 Trust The pursuit of ever more perfect accountability provides citizens and consumers, patients and parents with much more information, more comparisons and more complaints systems - but it also builds a culture of suspicion, low morale and may ultimately lead to professional cynicism – and then we would have grounds for mistrust Onora O’Neill, BBC Reith Lectures, 2002

7 Reference to mistrust of government information

8 Reference to loss of trust in police

9 “Trust enhances police legitimacy”

10 2011 Edelman Trust Barometer The lead of the story must be that trust is transformed. In the wake of the financial market meltdown at the end of 2008, we have gone through a series of corporate crises during from oil spills to product recalls affecting the leading enterprises in five sectors to the near-bankruptcy of five nations in the EU. We also found unprecedented scepticism, a need to hear, see or watch news as many as ten times before achieving belief, plus an increased reliance on those with credentials and expertise.

11 2011 Trust Barometer Top ten countries by GDP

12 Technology firmly on top Finance sector at bottom Responses 6-9 on 1-9 scale; 9=highest; Informed publics ages 25 to 64

13 Sources 2010

14 Sources 2011

15 Credibility

16 Developed markets more distrustful of the media Responses 6-9 on 1-9 scale; 9=highest; Informed publics ages 25 to 64; Top 10 GDP countries

17 What matters for corporate reputation? Quality, transparency, trust, employee welfare Responses 8-9 on 1-9 scale; 9=highest; Informed publics ages 25 to 64

18 Trust protects reputation Informed publics ages 25 to 64

19 The Edelman Trust Barometer in retrospect

20 Building Trust  Corporate social responsibility  Hobbes, Rousseau and Rawls  Quakers  Education  Communication

21 Benchmark Company position Philanthropy Enlightened self interest Business basics – law health and safety

22 The place of CSR Company mission Objectives/priorities Community needs and expectations Employee development interests

23 Matrix  Core values  Business objectives  Key publics  Employee support

24 Corporate Social Responsibility  A concern with these issues can actually lead to improved performance Crowther – Social environmental accounting September 2000  Sustainable companies, ie companies integrating economic aspects with environmental, ethical and social – yield a larger return than conventionally managed companies Holmstrom, S The Reflective Paradigm – Masters thesis 2002

25 The Co-operative Bank  Why are you our customers?  What else do you want? (30,000)  Human Rights – 90%  Armaments – 87%  Animal exploitation – 80%  Environmental damage – 70%  Fur trade 66%

26 Buddha As the bee collects nectar and departs without injuring the flower, its colour or its scent, so let the sage dwell in his village

27 Crises very often become trust crises There is danger in the possibility of jumping-over of trust losses to the next level Trust losses in individual actors/agents Gunter Bentele Bledcom 2009 Trust losses in organisations, products, brands, services Trust losses in smaller social systems (health, finance, pensions, etc.) Trust losses in larger social systems (economy, democracy as a political system, etc.) 27 A Theory of Public Trust

28 Single Issue Campaigners’ Advantages  Clear vision  Simple objectives  Controversial - therefore newsworthy  Attract celebrity

29 Is this correct?  ‘balance of power has shifted too far and that companies need to wrest back control of their reputations’  Or have we squandered it with self- centered behaviour? Andrew Griffin – New Strategies for Reputation Management in R and L p14

30 Calculated risk

31

32 Defining Risk  How do you define risk in your own organisation?  What are the main risk areas?  Where do communications/reputation fit in?  How do you respond?

33 Risk  A measure of the adverse effect of an issue  Assessing and communicating the possible hazards associated  Relative to the safeguards and benefits  Helps us as consumers to make choices about our health and safety and the protection of the environment  Regester and Larkin 2008:21

34 Auto responses to risk  Experiment  Fight  Flight  Play dead  Freeze  Renn 2010

35 Risk Issues

36 Assessing risks in advance

37 Influencing decisions Economic System Channeling effectively Pareto principle Distributive discourse (bargaining) Maximizing utility/ efficiency Social System Sustaining relationships Mutual understanding Therapeutic discourse Empathy/fairness Evidence/effectiveness Collectively binding norms/legitimacy Expert System Sustaining meaning Research and peer review Cognitive and interpretive discourse Political System Sustaining order Compatibility with universal or positive principles Normative discourse

38 Public’s involvement

39 39  DecidingUnderstanding Pre-assessment ManagementCommunication Characterisation and evaluation Appraisal IRGC’s Risk governance framework Who needs to do what, when? Who needs to know what, when? Is the risk tolerable, acceptable or unacceptable? Getting a broad picture of the risk The knowledge needed for judgements and decisions

40 Dialogue  A conversation without sides  40,000 untested chemicals  Public anxiety  Uncertainty  Negotiation

41

42 From communication to public involvement  Information needed for decision  Our brains are wired to forget  Allow for reflection and consideration  Inclusion – all policy options and scenarios  Preferences

43 Objectives of Risk-Benefit Communication Enlightenment: Making people able to understand risks and benefits (and their interactions) Behavioral changes: Making people aware of potential risks and benefits help them to make the right choices Trust building: Assisting risk management agencies to generate and sustain trust Conflict resolution: Assisting risk managers to involve key publics and affected parties to take part in the risk-benefit evaluation Renn 2010

44 Attitudes  Estimating – over for sensation, under for every day  Nature and nurture  Benefit and trust  Source  Emotion Regester and Larkin (2009:22)

45 Context  Newly emerging  Degree of existing  New perception

46 Defining the public relations problem Situation analysis Defining the issue PEST(LE) Political - Economic – Social – Technical (Legal – Environmental) Gregory, A

47 Risk perception  Emerging danger – randomness threat  Creeping danger – long delay  Yes – take the risk  No – no benefits seen  Maybe – want to trust but no proof  Arbitrary  Renn, O

48 Some Major Insights Risk-benefit communication needs to address:  Difference between risk and potential hazard  Difference between random event and faulty behavior  The process of management decision making  The trade-offs and value conflicts when making management decisions (risk-benefit-balancing)  The meaning of standards and the respective protective goal behind them Renn, O

49  Trust and credibility cannot be “produced” or “manufactured” but only earned in terms of performance and effective communication Renn, O

50 Communication  Urgency - conflict  Legitimate - research and listen  Public support  Misunderstandings create crises  Shared futures - mutual mindset  Respect social commons  Build significance - strengthen relationships

51 Journalists  Intellectually shallow, morally vacuous and socially privileged.  When politicians complain about journalists it’s like junkies complaining about their dealers. They both need each other.  Matthew Taylor - Fabian New Year Conference 2003

52 UK News Media  outstanding reporting and accurate writing mingle with editing and reporting that smears, sneers and jeers; names, shames and blames Onora O’Neill, BBC Reith Lectures, 2002

53 According to Jock Young  There is, institutionalised into the media the need to create moral panics and issues that will seize the imagination of the public. Images of Deviancy ed. S. Cohen Penguin 1971

54 Vital to us - hug a hack!  Understand what they want  Ensure you provide it all plus some  Be aware of the needs of the news media at all times  Never say no comment!

55 Hackney Council is reviewing its emergency comms planning in the wake of the summer riots as the London 2012 Olympics approaches Hackney’s head of media and external relations Polly Rance said that her comms department was prepared for the riots issue to take hold in the media again, in particular during milestones such as ‘one year on’ or during the Olympic Games. PR Week 18 October

56 What is Reputation?  Henry Ford - "You can't build a reputation on what you are going to do."  Reputation is the result of an organisation's former actions, not its promises.

57 Reputation  Research in definitely affected by bad behaviour, low morale etc  Little or not at all affected by business as usual or ‘good news’ stories  Most ‘relationships’ are built with those who have no consequence  PR must be at a the leadership level  Verčič, D -Trust in organisations: a study of the relations between media coverage, public perceptions and profitability - unpublished doctoral dissertation 2000

58 Reputation  Out of step with messages = inertia  In line = energy  PR is the profession best suited to the business of building loyalty and advocacy CBI  Reputation has grown to represent 70% of balance sheet assets - DTI

59 Returning to Relationships  Trust  Reputation  Relationships

60 Relationships’ outcomes  Trust (Chia:2005, Rhee:2007)  Increased media coverage (Downes: 1998, Jo and Kim:2004)  Decreased negative media coverage (Downes:1998, Jo and Kim:2004)  Success with political achievements (Kovacs:2003 Wise:2007)  Reduced Risks!

61 Thank You

62 Bibliography  Gregory A in Exploring Public Relations; Tench and Yeomans ed; 2nd edition p 284 (2009)  Greenwood, J in New Activism and the Corporate Response, Palgrave Macmillan 2003  Onora O’Neill, BBC Reith Lectures, 2002  Easton Mark 5 December 2011 last updated at 15:55: Were the riots caused by bad manners? BBC news accessed http://www.bbc.co.uk/news/uk accessed  Edelman Trust Barometer (2010/2011)  Crowther – Social environmental accounting September 2000  Holmstrom, S The Reflective Paradigm – Masters thesis 2002  Dhammapada The Wisdom of Buddha, translated by F Max Muller: Dover Publications 2000  Bentele, G Bledcom paper 2009  Regester, M and Larkin, J Risk, Issues and Crisis Management, Kogan Page 2008

63 Bibliography  Renn, O. Euprera congress, University of Jyväskylaä, Finland 2010  Isaacs, Dialogue - the art of thinking together, Currency Doubleday 1999  Wolstenholme, S Growth of social marketing, PR and Global Trends - Tritonic 2007  Tench & Yeomans, Exploring Public Relations, Pearson 2006  Matthew Taylor - Fabian New Year Conference 2003  S. Cohen - Images of Deviancy Penguin 1971  Verčič, D -Trust in organisations: a study of the relations between media coverage, public perceptions and profitability - unpublished doctoral dissertation 2000  Chia:2005, Rhee: 2007, Downes: 1998, Jo and Kim:200, Downes:1998, Jo and Kim:2004, Kovacs:2003 Wise:2007 in PR Digest,, Pearson 2009


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