OP-ED: Firms must show they're not cheating to win with public

When President Bush gave his State of the Union address, there was some amusement, even among Republicans, about his decrying the use of steroids in baseball - as though this national problem ranked up there with the deficit or the war on terror.

When President Bush gave his State of the Union address, there was some amusement, even among Republicans, about his decrying the use of steroids in baseball - as though this national problem ranked up there with the deficit or the war on terror.

But recent news stories stemming from the investigation of Barry Bonds' personal trainer have shown that the president might have been onto something. Suddenly, people are noting that players like Jason Giambi showed up for spring training looking a lot less beefy than they had been. Congress is considering tougher action on steroids. There's even discussion of whether Barry Bonds' 73 homers should have an asterisk. There's more to this than election-year rhetoric or the arrival of spring. A recent book called The Cheating Culture by David Callahan lays out, in 304 pages, what many people have noticed day to day: that the dog-eat-dog world of competition - in sports, in business, and in other walks of life - has now placed enormous pressure on ethical standards. As the book notes, the problem doesn't stop with coddled athletes taught by college recruiters that partying is their due. It extends to celebrity CEOs who use high-flying rhetoric and shady bookkeeping to paint a rosy picture of earnings growth, while treating themselves to $15,000 umbrella stands. Stories like these obviously contribute to public skepticism about corporations. When respondents to this year's Reputation Quotient survey were asked to characterize the reputation of corporations in general, 74%of them answered "not good" or "terrible." However, the public's attitude isn't just due to oft-bemoaned "media sensationalism." In fact, the media is, frankly, understaffed to deal with the dimensions of the problem - as is the legal system. On a recent day, courtroom sketch artists literally ran from courtroom to courtroom in the same Manhattan courthouse in an attempt to cover same-day proceedings involving Martha Stewart, Bernie Ebbers, and former Adelphia executives. And prosecutors, in the flush of victory, freely admitted that they wanted to make an example of Martha Stewart. Implicit is that they simply can't address every potential case like hers. No wonder that the public has grown cynical about corporations. Does it matter? Perhaps it does at a time when many consumers, to hear their stories, are being routinely nickel-and-dimed on issues ranging from denial of HMO charges, to endless tech-support waits, to cellular phone "packages" that seem designed to prevent a clear comparison of costs. Granted that the truly bad actors will ultimately be punished in the courtroom or the marketplace, what are honest corporations to do to avoid being tarred with the same brush of pervasive public cynicism? It doesn't mean brandishing an ethics manual and stating proudly that all your employees must read it and sign it. Nor does it mean putting an emphasis on teaching values and enforcing them - essential though that is. The reason these approaches aren't likely to be persuasive to the public, among other things, is that the public - based on its experience of living today - is concerned that it's impossible to succeed without cheating. As Callahan points out, otherwise upright people are concerned that if they don't cheat, they simply won't be able to make it in modern society. And day-to-day life reinforces this theory on many levels. That's a powerful story. And it's not just about corporations - it's about what the public believes is necessary to succeed. So convincing the public that you are not cheating today requires an extra dimension of persuasiveness about the business itself - conveying, in a believable way, just how you are going to succeed in an admittedly dog-eat-dog climate. And that does not mean rhetoric that's as bloated as Giambi's biceps used to be. It means - in a tough era of competition, when ubiquitous technology makes it hard to gain a competitive advantage, or keep it for long - being very precise about exactly where you have an advantage and very detailed in showing how you are exploiting and sustaining that advantage. It's a game of details clearly communicated. And while numbers ultimately tell the story on Wall Street, clear language is essential with investors and everyone else - from employees who might soon have a greater choice about where they work, to venture partners looking for assurance that the partnerships are beneficial for them, to politicians looking to build their careers through successful prosecution of celebrity CEOs or grandstanding against "greedy companies."
  • Jim Sloan is director of the corporate practice in Hill & Knowlton's Chicago office.

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