After Volkswagen: Communicating better in an era of rising antipathy towards business

In the wake of the Volkswagen emissions scandal, Is the public image of business at large slipping from bad to worse, and if so how much is poor communication to blame? The Chairman of Lloyd’s of London, the world’s biggest insurance market, warned this week of what he sees as a rising tide of distrust among regulators and members of the public over the way big business operates. Speaking at the Lloyd’s annual dinner, then again on BBC Radio Four’s Today programme the following morning, John Nelson said companies are too focused on profit, and are at risk of eroding the trust of both regulators and the public in a way he has not seen before. “We can only make the case for open markets in trade and investment if business shows greater transparency, greater social responsibility and greater accountability when things go wrong,” he said. Coming hot on the heels of a number of corporate scandals, topped by the astonishing revelations of emissions-test cheating by VW, hitherto one of Europe’s most trusted companies, this message rings sadly true.

This is partly, but only partly, about communication – or lack of it. Someone recently pointed out that they were constantly amazed at how many advisers are paid large sums of money to advise CEO’s not to do TV and radio interviews, as they are perceived to be too risky and they might get asked difficult questions. This is easy in the short term but can be disastrous in the long term. Why should we trust you or your brand if you won’t come out and be open and transparent about what you’re doing and why you’re doing it? VW has far more than a PR problem on its hands, but the lack of communication has made things much worse, with an extraordinary lack of timely information on how many vehicles are affected, and who authorised the offending test-cheating software.
At the opposite extreme, people are fed up to the back teeth with all spin and no substance – this partly explains the enthusiastic reaction in some quarters to the new Labour Party leader Jeremy Corbyn who is felt to be ‘authentic’ and ‘says what he thinks’.

So the challenge for companies is considerable; to be able to do the right thing, then communicate this consistently and effectively, holding their hands up when they get it wrong, and telling us what they’re doing to put things right. That means the business has to behave properly and ethically, coupling this with a strong media presence where possible. There has to be a willingness to acknowledge weaknesses and failings, explaining what’s being done to tackle them – not just being ‘on-message’ about the successes. It also means spokespeople who have been through the right sort of media training, not to tell them how to avoid the questions, but to be as open and honest as possible about the issues, as well as getting their own points across. It’s not easy, but the alternative for business, in terms of rising public support for tougher regulation, fewer business tax breaks, and a more critical attitude from legislators, is likely to be much worse.