When PR firms become the news, it's a different kind of crisis

When trying to manage a crisis, organisations and individuals are often overwhelmed, writes Associate Professor Daniel Laufer.

During “Dieselgate”, the Volkswagen emissions crisis in 2017, the company was busy managing a global recall and communicating with those affected  around the world about the crisis.

At the same time, it had to manage its other product lines, including the company’s petrol vehicle operations, which were not part of the global recall.

Because of the tremendous challenges organisations and individuals face during crises, many turn to public relations firms for help.

These firms are usually hired for their expertise in crisis management gained through years of experience working in the field.

Normally a public relation firm’s advocacy work on behalf of its client is not the focus of scrutiny by the media during a crisis.

But recently a public relations consultant was facing a crisis of his own because of work on behalf of a prominent businessman who was accused of sexual assault.

Jevan Goulter was reported to have participated in a meeting at a hotel in Australia where the victim of sexual assault was pressured to withdraw his complaint against the businessman.

This incident raises important questions around ethical practices involving public relations firms. Is there a code of ethics for the industry? What are the consequences of public relations firms behaving unethically while advocating for a client during a crisis?

The Public Relations Institute of New Zealand is the industry group.

According to the organisation's website, it was established in 1954, and has more than 1300 members. In order to become members, public relations consultants are required to follow a code of ethics.

Very few complaints have been filed against members by the public for violating its code of ethics. According to Elaine Koller, chief executive of the institute, since 1999 only 10 complaints have been filed by the public alleging violations of the code of ethics. Out of these 10, only two were upheld.

Out of the two complaints upheld, one was related to a public relations firm helping a company during a crisis.

The complaint, filed 20 years ago, involved public relations firm Shandwick International which was hired by Timberlands, a government-owned logging company.

Timberlands hired Shandwick to help the company defend itself against opponents who wanted to stop native logging.

The code of ethics violation involved the use of the word “extremists” to describe opponents of Timberlands' operations.

The institute found that the two Shandwick public relations consultants should not have agreed to Timberlands’ use of the word “extremists” to describe opponents of logging. While a number of the opponents used extreme tactics to stop Timberlands from logging activities, others engaged in legitimate forms of protest.

How would the institute handle the recent actions of Goulter? Would the behaviour of the firm’s consultants be a violation of its code of ethics?

According to Koller, Goulter is not a member of the institute. Therefore, it would not have been able to take any disciplinary action against them. Only members are subject to the organisation’s code of ethics, and people that are not members cannot be investigated.

Koller believes that based on what has been reported in the media, had he been a member, anyone from the public would have been entitled to make an ethics complaint about their activities.

After the complaint is received it is reviewed by an ethics panel, and if the panel finds that the individuals had breached the code of ethics, it has the power to recommend a fine or expulsion.

The complaint would need to specifically detail which aspects of the code of ethics had been breached. For example, a complaint might refer to a section in the code relating to the need to decline representation of clients or organisations that urge or require actions contrary to the code.

It is encouraging to see the institute has a code of ethics for its members. Also, the low number of complaints suggests that ethics violations among its members are rare.

However, there are many public relations consultants who practice in the industry that are not required to follow the institute’s code of ethics.

According to Koller, the number of people practising public relations is much larger than the institute’s membership. She estimates that due to the broad scope of public relations activities, there are between 8000 and 12,000 people that work in the industry.

This may suggest that we will see more cases in the future involving questionable conduct by public relations firms.

It is important for public relations firms to advocate on behalf of their clients during a crisis. However, there are certain ethical red lines that shouldn’t be crossed in the name of advocacy.

Dr Daniel Laufer is an Associate Professor of Marketing at Te Herenga Waka—Victoria University, and an expert in crisis management.