Holding back revenues leaves agency picture incomplete

Roger Maris' 1961 home-run record was marked with an asterisk in the record books, a salvo to Babe Ruth fans indignant that Maris had surpassed the Bronx Bomber's record in a longer season.

Roger Maris' 1961 home-run record was marked with an asterisk in the record books, a salvo to Babe Ruth fans indignant that Maris had surpassed the Bronx Bomber's record in a longer season.

A similar asterisk has been attached to PRWeek's agency rankings, included in this issue's Agency Business Report, since 2003, when the holding company firms first declined to participate in the process.

The reason cited then, and reiterated since, is Sarbanes-Oxley - though it is only an interpretation of SOX that dictates their refusal to take part, rather than specific terms of the legislation. For Edelman, its reign at the top of the second-generation league tables has probably been bittersweet without the representation of its peer group of the largest agencies.

But this year Edelman might take some comfort in observing how it has surpassed the historical revenues of the holding company agencies. At $216 million in US revenues, the firm has surged ahead of the 2001 US revenues of such firms as Hill & Knowlton, Ketchum, and Burson-Marsteller.

Of course, those firms will have advanced beyond their historical revenues, as well. But there is no way at this point of proving it, beyond the aggregate numbers, the reporting of which is not even consistent from parent company to parent company.

Every year we publish our objection to the decision to withhold this information, and each year the decision stands. And while we work hard to compensate for the lack of specific revenues for these firms with in-depth analysis from a number of different perspectives, there's always that one key piece of data missing.

It is too bad for the holding company firms that don't participate that their historical numbers are stuck in a time of turmoil and pain for the industry. In the 2002 rankings, which reported 2001 numbers, Lou Capozzi, then CEO of Manning Selvage & Lee, told PRWeek, "Because of the huge downturn, the managers of PR firms now have a problem within their holding companies. They need to regain fiscal credibility."

Internal financial processes have evolved considerably since that time, but there is no external evidence of that fact. PR firms have more muscle in their holding companies than ever, if their words are to be believed. It is time that these owned agencies used that increased clout to lobby for openness in the area of revenues, as they purport to embrace openness about the business as a whole.

None of this should take away from the achievements of Edelman or any other firm that has the conviction, as well as self-interest, to submit its revenues for annual rankings. In this year's report, 194 agencies took part, and each one deserves credit and recognition for their transparency, as well as their commitment to the continuation of an industry benchmark that is truly significant.

Edelman, still at the top* shows no sign of slowing down, with 26% growth (including the A&R Partners acquisition) and success in winning key business across sectors. While its story is a standout in its own right, it also poses the tantalizing possibility that one day the asterisk might be retired.

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