PR struggles for voice on executive committee of FTSE 100 firms

Research reveals fewer than half of FTSE corporate affairs directors sit on executive committees.

Fallout: Barclay's ex-CEO Bob Diamond has faced scandal (Credit: Rex Features)
Fallout: Barclay's ex-CEO Bob Diamond has faced scandal (Credit: Rex Features)

A void is emerging between the growing reputational threats faced by major firms and the seniority of their top comms figures, new findings have suggested.

Research by headhunters Watson Helsby has revealed that only two-thirds of FTSE 100 companies currently employ a corporate affairs director and that fewer than half of those roles are on their firms' executive committees.

BP and Unilever are understood to be among the largest firms that do not have corporate directors on their respective executive committees.

The findings, which cover 93 of the UK's top 100 listed companies, also noted that it was 'extremely unusual' for the top communicators in organisations to sit on the board, with a rare example being Lucy Neville-Rolfe, Tesco's outgoing corporate and legal affairs director.

Ian Wright, corporate relations director at Diageo, expressed surprise at the findings, arguing that the importance of senior in-house board-level counsel was increasing due to the myriad of regulatory and reputational issues firms were facing. 'The complexity of issues and the need to manage reputation is becoming increasingly apparent and is taking a bigger place in the management of most businesses,' he said.

The comms responses of a number of UK-based firms embroiled in recent crises, including G4S, Barclays and News International, have come under particular scrutiny as they strive to contain the reputation fallout.

McDonald's vice-president of comms Nick Hindle - who holds a role on the executive committee - said the value organisations placed on their stakeholders could partly be measured by a seat on the board for comms directors.

However, he added that such roles were 'not essential' for all companies, pointing to the overall attitude of the CEO towards comms as equally important. 'Even if we're not on the board, organisations that still use comms proactively will have a close working relationship with comms people,' said Hindle.

Peter Morgan, comms director at Rolls-Royce, went further, arguing that PR had no inherent right to be on the executive committee. 'Comms directors have to earn a place at the top table. The good ones are naturally elevated and it is the value of advice that gets them there. They shouldn't be there by right,' he said.

Three in four comms directors report to chief executive

One quarter of corporate affairs directors do not report directly to the CEO, the findings by Watson Helsby have revealed.

The study showed 76 per cent of corporate affairs directors reported directly to the top figure, with the CFO second highest at ten per cent.

EADS UK vice-president of comms and PR Jeremy Greaves said the figures had left him 'astonished'.

'To do the job properly, I don't see how you could report to anyone else,' he said.

'I am astonished that there's even a debate; that's a number that still needs to go up. If it's not 100 per cent, then it's not good enough. The CEO is the figure to be in contact with.'

The research also revealed that a reporting line to the CFO was most commonly found in companies where there was a combined internal relations and comms director role, whose core area of expertise was employee comms.

 


 

HOW I SEE IT

Dominic Fry, director of comms and investor relations, M&S

Being on the executive management committee is very helpful to be able to take a holistic view of an issue. It's good to be able to have a discussion and devise a position rather than thinking about just the reaction of the City, the media or the customers.

Guy Ensouf, head of PR and public affairs, E.On UK

What matters is not necessarily whether you have a seat at the table, but that you are involved in the discussion. It is not about the formal organisation within the company, but that the head of comms has ready access to the CEO and board directors, and can get a good hearing.


54% 

FTSE 100 corporate affairs directors not members of exec committee*

76%

FTSE 100 corporate affairs directors who report to the CEO*

15%

Maximum amount Barclays shares fell in response to Libor scandal**

32%

Percentage corporate reputations contribute to a firm's share price***

Source: *Watson Helsby;**Daily Mail;***Echo Research


Danny Rogers: FTSE firms should have comms on board. Read more

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