The disappearance of Edelman China CEO Steven Cao and possible investigation into the agency’s relationship with former shareholder and TV presenter Rui Chenggang shines a light on a wider issue that all brands and agencies operating in China must address.
The situation with Edelman seems to relate to the fact that Chenggang still held shares in Edelman subsidiary Pegasus Communications while the agency engaged in a commercial relationship with his employer China Central Television (CCTV), which involved Chenggang himself participating in panels at the World Economic Forum in Davos.
This is an issue for Edelman to investigate, which it is doing, although on the surface it doesn’t seem to be pay for play as such. Pay for play has been an issue for PR pros operating in China for some time, especially those from large global companies or agencies that have a global code of conduct that forbids such arrangements.
The new cultural situation in the country and the landscape in which media operate really started changing following the November 2012 18th Party Congress, when China's government decided to try and find ways to connect better with the people, which in principle sounds like a noble ambition.
A global public affairs pro I spoke to who is very close to this issue agreed that Chinese journalism is desperate for much-needed reform.
And he noted that when you look at the massive budgets for state-of-the-art studios such as Chenggang’s employer CCTV's new operation in Washington, DC, with its stated goal of being the next BBC, or the state-run news agency Xinhua holding a dominant promotional space in Times Square, it is clear China's media needs to play at a higher level.
He continued by pointing out that China has long been known as an environment where pay-to-play journalism is expected by PR firms and journalists alike, coupled with state media reporting that has all the excitement and flavor of a frozen TV dinner. So it is clear something needs to change, and it is seen by the party as the key vehicle to make its leaders more accessible and relatable.
The UK Telegraph reported in December 2012 that "government-controlled media would turn their backs on 'bureaucracy, formalism and extravagance.' Lengthy and dull reports on official visits would in future be spiked in favor of more pithy stories with a greater emphasis on ‘news values.’ Already some stories had been ‘dramatically shortened,’ the Global Times claimed."
This all sounds perfectly laudable, until you look at the set of guidelines released at the start of July by China’s press authority that ban the media from reporting state and commercial secrets and what it opaquely terms "unpublicized information" – I always thought that was what we called "news."
This sounds much more like reining in journalists than promoting news values and stemming corruption. Time reports that journalists already receive daily government directives on what they can and can’t write about. And it says the Chinese government has refused to issue new accreditation for reporters from Bloomberg and The New York Times after these outlets published stories of which it didn’t approve.
What isn't clear is how the investigation and removal of Rui Chenggang from his perch as CCTV's top business anchor and the disappearance of Edelman's Steven Cao is connected to government attempts to weed out corruption throughout the system or its efforts to improve the quality of China's journalism.
As the public affairs pro concluded, the bottom line for brands and communicators operatoring in the space is that the environment is changing, and the old ways are being pushed aside. The scenarios currently playing out for Cao, Chenggang, and others show that PR firms, advertisers, and journalists in China are all on notice.