This week on Street Talking in NEXT, I look at the growing tendency of shareholders to take up arms in defense of public company management under government attack and wonder what its implications will be for corporate communications strategy during times of crisis.
In the old days, whenever things turned sour in foreign countries, big business used to call on their home government to race to their rescue and it often did. Sometimes a phone call was all it took to sort things out. At other times, less subtle means like a coup d’état were used to get rid of troublesome political leaders. This happened in 1953 when Prime Minister Mohammed Mossadegh of Iran was overthrown in a CIA plot for threatening to nationalize the assets of a certain Anglo-Iranian Oil Company, the parent of today’s BP. Almost six decades later, BP is in another fix because of the potential for cleanup costs of an oil rig explosion to push it to insolvency or a forced sale.
But this time its opponent is no tupenny-ha’penny potentate. It is the President of the United States of America, the world’s only superpower. Who can save BP this time? Not the British government whose deputy Prime Minister, Nick Clegg, has cautioned that the matter does not ‘spiral into a tit-for-tat political, diplomatic spat’ or ‘descend into megaphone diplomacy.’ For his part, David Cameron, the British prime minister has been more subtle by calling for a ‘sensible dialogue’ so that ‘BP remains a strong and stable company.’ Smart British pols are not prepared to pick a fight with the US over an oil company.
If the tormentor looking for ‘whose ass to kick’ lives at the White House and relief will not come from 10, Downing Street, then where can BP turn to? From the latest news, it seems that a volunteer troop of shareholders are its best bet. Without putting too simplistic a weave on what is undeniably a complex issue, the mobilization of a BP Shareholders Resistance Army to challenge the ‘shakedown’ of their company signals a big shift in international business diplomacy.
What makes this relevant from a corporate communications-investor relations perspective is how those charged with external communications would need to devise effective means for working with these militiamen and irregulars to achieve company goals in situations of risk. For all their enthusiasm to lend support to companies at moments of crisis, their eager but often poor riflemanship may work at odds with the defined corporate communications plan. Engaging and absorbing them to avoid friendly fire will be an increasingly important part of the corporate communicators’ task list at such times.
In the last couple of weeks, the fury of UK commentators and shareholders over what are perceived as inconsiderate attacks on BP by President Obama has given us the 21st century equivalent of ‘what is good for General Motors is good for America’ interest equivalence. From the way several leading voices in the UK tell it, what is good for BP is good for Britain. The unabashed trumpeting of jingo-speak reveals volumes not just about the enduring natal identities of multinationals, but the growing tendency for shareholders to adopt independent offensives, ostensibly in support of companies, when they perceive their interests are threatened. Obama’s call that BP freezes its dividend payment has only poured petrol on their rage.
Bearing in mind that BP, which the US president insists on calling British Petroleum, contributes about 11% of dividend income in the UK, Geoffrey Wheatcroft, the British journalist, has warned his co-citizens that:
Every British insurance company, building society and pension fund has large holdings of BP shares in its portfolio. If you have a pension, at present or in prospect, your income falls with every sour word Obama speaks.’ That is counter-accusation at its best.
If the Americans care about sealife and the livelihood of those living in the Gulf region, then the British have an equal right to care about the fates of retirees, savers and shareholders who are dependent on BP substantial and regular payouts.
A letter by John Napier, chairman of RSA, the insurance group, to the US president encapsulates all the bitterness over BP’s alleged victimization and the employment of double standards by the US: ‘There is a sense here that these attacks are being made because BP is British. If you compare the damage inflicted on the economies of the western world by polluted securities from the irresponsible, unchecked greed and avarice of leading USA international banks, there has not been the same personalised response in or from countries beyond the US.’
David Bickerton, BP’s director of communication, would never dare put words of that strength in writing.
Shareholders have become a strident voice, the ‘bad cop’ to the official corporate communicator’s ‘good cop’, in challenging attacks on their company. With skin in the game, but without the diplomatese of corporate communications specialists, these shareholders tell it like it is. If you are going to hit the company, you need to hit us first is their war chant. Expect to see more shareholders refuse to allow their companies to be bullied into quick surrender by regulators. They are vehemently rejecting any horizontal collaboration with the enemy as happened between French women and German soldiers in occupied Vichy France during the Second World War. No sex please, we are shareholders.
One cannot help noticing how Niyi Meka Olowola, Oando's Head of Corp Comms, is nodding in approval. Maybe Goldman Sachs can learn lessons.04:47:49 PM January 25, 2012from HootSuite
It's at times like these companies praise heaven for media-savvy CEOs.Among Nigerian business leaders,Wale Tinubu, is easily among the best.04:46:01 PM January 25, 2012from HootSuite
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