In a dialogue with Paul Holmes, former Shell communications chief acknowledges that the oil industry got ahead of itself in communicating its commitment to renewables and sees BP needs to begin and join conversations about the industry's future.
Paul Holmes: It seems as though many of the engineering decisions taken in the months and weeks before the spill increased the risk of a crisis. Clearly those decisions had serious reputational implications, but I always suspect they are taken without much – or any – input from public relations professionals. Typically, are PR people consulted on these decisions? Should they be?
Bjorn Edlund: PR people have no competence to be consulted on individual engineering decisions, but it is useful for the PR people to have a professional overview of the level of the technical standards that are being applied in challenging environments. In a well-run corporation like BP, one would be safe to assume that high standards are set and met.
PH: I guess the obvious follow-up to that question is whether there is anything PR people can do to put themselves in a position where they will be consulted over such decisions.
BE: PR people, both the most senior corporate communications manager and the public affairs specialists, must be included in a company´s regular review of its policies and standards that touch on all aspects of its environmental and societal impact, both at global and local levels. Communications people are regularly put in a position where policies are contrasted with aspects of the real performance, and must be intimate with the company´s ambition level. Also, PR people bring insights to the decision-making process that won´t usually be covered by the legal or technical colleagues.
PH: BP had invested heavily in corporate responsibility and environmental imaging in recent years, particularly through its “Beyond Petroleum” advertising. It now looks as though there was a huge gap between the image and the reality. How do you strike a balance between aspirational messaging – “we are trying to do better” – and the danger of setting expectations too high?
BE: The whole industry drifted towards the slightly surrealistic in its communications about 10-12 years ago, and it sounded some times as if the oil and gas age would soon be over and renewables would replace fossil fuels. I guess this came from a combination of the new technology spirit around the millennium and the great response that was given to any news about renewables. Beyond Petroleum fits into that spirit.
We had our own climb-down to make when I joined Shell, shifting from corporate identity programs that seemed at times to come from a renewables company to a more realistic discussion about the hard truths in a realistic energy mix. Aspirations are key, especially in advertising, but you have to keep both feet on the ground. Over all, I think brand reputation management in these issues-rich environments must rely much more heavily on earned media, PR and engagement. Taking advertising to issues is a bit like bringing a hammer to pottery class. It has an impact, but not the one you´d want—if it is used on its own.
PH: The regulatory environment in the U.S. has come in for some criticism in the wake of the spill. It seems to me that a lax regulatory environment – which I suspect most companies reflexively prefer – carries some risk for companies, particularly when a crisis occurs. Is it time to re-think the relationship between companies and regulators? Is it naïve to expect companies to perhaps welcome –or even invite – stronger regulation if it reduces the risk of a catastrophic event such as this one?
BE: Responsible companies in risk-filled sectors have nothing against stricter regulations, as long as the playing field is kept level. I have worked in the pharma sector, with agrochem and electricity, as well as in oil and gas, and I have seen my colleagues welcome stricter rules time after time. As for the Gulf of Mexico leak, we don´t know yet what exactly caused this catastrophic event, and I think we should wait for the technical reviews by BP and the US government before we pass judgement on regulations.
PH: There have also been suggestions that BP did not have an adequate crisis plan in place, or that some elements of that plan were out of date. Certainly, the company seems to have been taken by surprise by the scale of the disaster. Was BP adequately prepared? What could the company have done to be better prepared?
BE: I don´t know enough about their plans to comment. [BP chief executive] Tony Hayward himself seemed to say that BP had been overwhelmed by what happened. In general, it is clear that safety and recovery preparedness, including crisis communications training, are key. Everywhere I´ve worked we have held regular drills based on simulations, which included both technical and quasi-political challenges in the exercise scenario.
PH: Tony Hayward has come in for a lot of criticism for several “gaffes” from suggesting the environmental impact of the spill is not that serious to asking for his life back. I must admit to feeling some sympathy here. On the one hand, we ask for companies and their CEOs to “be more human” and less scripted but when they make human mis-statements we are fiercely critical. How do you strike a balance? And how would you rate Hayward’s performance?
BE: I think he has faced an impossible task. It is hard to be a non-American in U.S. media when something goes wrong. I think the media treatment of Hayward partly reflects this cultural gap between how a Briton, with a slightly stiff upper lip, handles himself under pressure, and the emotive aspects that are part and parcel of how public figures appear in the US culture. The media has been very harsh, but if we read how they have commented on President Obama´s failure to appear angry, you must wonder how seriously you should take these attacks.
I think CEOs have an impossible job, and have nothing but admiration for anyone wanting to be the public face of a large company. It is important to limit the exposure, though, especially in a crisis when every word and gesture is scrutinized. Sadly, some media seem more interested in points scoring than in making clear how these important events unfold.
PH: There’s been plenty of discussion of the role of social media in this crisis, from BP’s own efforts at outreach in the digital realm to a parody BP Twitter feed. How much has social media changed the rules of engagement during a high-profile crisis such as this one?
BE: Social media allows the company to read the temperature of opinion in real time and offers an opportunity to address the interests of their stakeholders in varying levels of depth and detail. Knowing how you balance your view of social media as a collection of channels and a collection of communities is key. They haven´t changed the rules of engagement more than making the requirements for responding in real-time even more important.
PH: In general, how would you rate BP’s public relations response to the crisis?
BE: I don´t want to rate the BP PR response. I´ve been in crisis situations and know that no one who isn´t in the inner circle really knows how much pressure is brought to bear, and how unfairly trivial ´mistakes´ are sometimes blown out of proportion. Anyone reading the paper and watching television will see the onslaught they´re under. The magnitude of the ecological and technical crisis they face has grown every day, and now they face a growing political and stock market challenge, too.
We´ll see when the oil leak itself is under control how effective BP can be in containing these other, non-technical aspects of this crisis, and if they can perhaps build on some of the relationships that this catastrophe has thrown them into. I don´t know that any company could have handled a crisis of this size, importance and visibility well.
PH: Assuming that the company eventually gets the spill under control, what does it need to do over the coming weeks and months to start to repair its image?
BE: It needs to begin a number of "other conversations," or join such initiatives. New energy policies, offshore technology development, better uses of energy, any number of subjects can and should be addressed in a long value chain that might start with research and development and continue through to community relations across the entire spectrum of BP does, as well as its relationship spectrum. The hardest thing is to free up leadership time to strategize about what the priorities need to be in this next phase, beyond continuing to respond to the political, social and shareholder pressure that will unfold in the aftermath.
PH: There have been several major crises in recent months, spanning several sectors, and the companies involved – J&J’s McNeil subsidiary, Toyota, Goldman Sachs, and now BP – have all come in for criticism for their PR response. Have we all forgotten how do crisis PR? Has it gotten more difficult somehow?
BE: I think we know how to do crisis PR, but it seems to me that we might have forgotten how important it is to keep a cold eye on the real non-technical risks our companies face, so that, when something goes wrong, we´re not overwhelmed by the response from an increasingly skeptical public who are, unfortunately, not getting the political leadership that is needed both in calm times and when a crisis hits.
Björn Edlund, former executive vice president and head of group communications at Royal Dutch Shell, is now a senior adviser to Burson-Marsteller and an independent consultant.