Honesty is not an easy option in PR

One of the great City figures of the post-war years, AW Trinder was famously heard to remark that honesty was the best policy. He knew. He had tried both... and he did die a rich man.

These days though, honesty is a word the City is a bit embarrassed about. It has always sought to create the impression that everyone and every organisation is trustworthy. But no one has ever based a PR or marketing campaign around being honest and truthful – because it inevitably implies that the others in the industry are not. Enter Jonathan Compton, boss of a still quite new fund manager Bedlam.

He has noted the total collapse of trust between those who run the financial services industry and its potential clients. But rather than wring his hands, he has based his entire business ethos on being open and honest with his clients, on being transparent in his charges and in only taking fees when the customers themselves have made money.

The result has been a newsletter that is essential reading among journalists and intermediaries as week after week it exposes the stupidities and venality of the fund management industry. The question is whether being honest is enough of a differentiation to build a business.

Earlier this week Bedlam published its results for the year to December and funds under management had risen from just over £1m to £17.7m. In City terms it is small beer and Compton appears a bit disappointed. He thought his ‘less dishonest’ approach would produce faster inflows than it in fact has. But he underestimated the inertia in the industry and the financial interest so many of its participants have in the status quo.

Compton’s experiment is very much a test of the power of PR. If he can continue to make people question the existing model, then gradually the barriers should crumble and he should benefit. But all he has proved so far is that being honest is certainly not the easy option.


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