Is There a (Spin) Doctor in the House?

When the Securities and Exchange Commission recently charged three former senior executives of IndyMac Bancorp with securities fraud for “misleading investors,” two fundamental questions immediately arose in investor relations and strategic public relations circles:  Did they have professional IR/PR counsel when communicating with investors?
Contrary to popular and misguided belief, the professional practice of investor and strategic public relations isn’t about painting rosy pictures, making things appear better than they really are, or coloring fact.  Rather, best-practice counsel condones transparency, clarity, and timely, factual representation of corporate news–good or bad.
The corporate executives at IndyMac are accused of making false and misleading disclosures about their company at a time when its financial condition was rapidly deteriorating.  Perhaps in time, we’ll learn if they were counseled by IR/PR pros or not.
As Lorin L. Reisner, deputy director of the SEC’s Division of Enforcement, said in a statement, “Truthful and accurate disclosure to investors is particularly critical during a time of crisis, and the federal securities laws do not become optional when the news is negative.”
We and our fellow professional communications brethren couldn’t agree more with Reisner.  These IndyMac Bancorp officers now need legal representation.
Ironically, communications counsel is crucial more than ever, since the fight will continue in the court of public opinion, as the executives look to prove their innocence and reestablish their careers.
To many outsiders, this could sound like a job for a (spin) doctor.  The truth is that IR and PR pros, many of whom– yours truly included–began their careers as journalists, abhor the notion of spin, including the word itself.    There is no cure-all medicine for managing a crisis.  Only solid thinking and communications skills will win the day; certainly not a job for a doctor of spin.


Roger Pondel,

CEO Semantics

On my way to work several weeks ago, I was listening to a special on NPR about “How Can You Tell When a CEO is Lying.” According to the piece, two researchers from Stanford University took it upon themselves to study thousands of corporate earnings calls and come up with a way to tell when executives are lying.
The researchers found that when CEOs and CFOs take questions from analysts after an earnings call, a few key indicators of dishonesty include words such as “we,” “us,” or “the team” when talking about the company. The word “I” is rarely used, as executives try to deflect any ownership of what is being said so they personally are not held responsible for anything. Additionally, the overuse of words that express positivity can be a form of overcompensation. Words such as “excellent,” “fantastic,” and “outstanding” also portray more hype than fact.
In this day and age, there’s no exact science to interpreting a CEO’s semantics, but there are certainly key terms to be cognizant of.  In our line of business, it is important to get to the point of important topics without using fluffy adjectives.  Credibility is key when it comes to communicating with investors and that starts with avoiding hyperbole.



Review Internet Policy Before Losing Your Shirt

Former U.S. Representative Christopher Lee

Former U.S. Representative Christopher Lee (via Gawker)

Thankfully for him, U.S. Representative Christopher Lee (pictured to the right via Gawker) had the good sense to resign within just a few hours of his shirtless photo/response earlier this week to a personal ad becoming the lead story in both gossip pages and major media outlets.  Lee may just have meant to send a simple, flirty email.  But he wound up being embarrassed and losing his job.  
What does this have to do with strategic public relations or investor relations, you may be asking?
The incident serves as another cautionary tale about  how easily personal information can find itself in unintended hands due to the power and immediacy of electronic media.  In our world, this incident and others should serve as reminders for companies to review their social networking and Internet posting policies.
In one recent lawsuit between the National Labor Relations Board (NLRB) and American Medical Response (AMR) of Connecticut, NLRB alleged that AMR illegally fired an employee for posting critical remarks about her boss on Facebook.  The NLRB said AMR’s Internet policy, which prohibited employees from, among other things, making disparaging comments when discussing the company or superiors, was overly broad and interfered with employees’ right to free speech.
AMR settled the case, agreeing to relax its rules.  But companies should review their policies to determine whether they interfere with employees’ protected first amendment rights, including the right to discuss wages, hours and working conditions with fellow employees or others.



Adding value for clients when content is king

Glancing at any traditional outlet online will show stories covered across multiple platforms using video, audio and yes, good old fashioned text.  While agencies are optimizing press releases to accommodate the new media landscape, knowing how to leverage video properly can be a challenge.
Simple is better.   A short flip video of a client providing unbiased expert commentary can be leveraged with a local newspaper or business outlet.  Offering advanced or exclusive access to the content can go a long way in securing coverage.  Knowledge of proper video handling is also important, although most video captured and shared is not created by professionals.
It’s OK if it doesn’t get picked up.  Video can be shared across an organization’s own social media including Facebook and YouTube, which can be found by a simple search using Google or Yahoo.  Local or corporate events also can be leveraged.  The content builds credibility and helps foster engagement with key target audiences.
More media are using video in their daily coverage.  However, beware that not all content is good.  Make sure the video adds value not only to media but to current and prospective audiences as well.


George Medici,