Kurt P. Stocker

Public Relations in the New Century "A Good Story, Well Told"

Thank you. I am still not sure how to respond to this incredible honor. It certainly has made me count my blessings, beginning with my wife Kathleen who has helped me stay the course for 42 very special years. To be sure, there were ups and downs. But she has never faltered in her belief in me, especially in the down times, and I am eternally grateful.

This honor has made me reflect on the exciting times in which I have worked -- times that have produced my heroes in this business. Ed Block may be the smartest man I have ever known. Larry Foster the wisest. Jack Koten remains the rock solid conscience of the society and the profession. I have never won an argument with any of them ... and rightly so ... but I have cherished every working moment.

To Ron Rhody, Dick Mau, John Graham, Dan Edelman -- true professionals that I have looked up to and listened to over the years -- I am humbled to be in your company.

And to the people in this room that I have been privileged to work with, you know, as I do, that you have contributed mightily to this moment. Thank you for making me look so good. I'll try not to embarrass you in the next twenty minutes.

Some of you know my secret. I started my career as a human resources person. I worked in the personnel department, hiring and firing people, paying payrolls, administering benefits and -- fortuitously -- "fighting" unions. Fortuitous because in running campaigns to win hearts and minds, I found my passion, my career.

My real "break" came when the company, Allstate, was singled out as the poster child for redlining in the inner city and I was seconded to the public relations department. In those days, being seconded to public relations wasn't necessarily considered career advancement. But for me, it was right up my skill set ...interceding in advocate-to-advocate combat.

It took a year of screaming headlines and meetings in church basements and boardrooms to divine a resolution that advanced the public interest and the company's. It was intoxicating ... it was so cool ... I never left.

Looking back, I realize now that working for enlightened CEOs and with enlightened public relations professionals was my other career "break". I went from perfect job to perfect job ... working with people who believed communication could produce benefits for the enterprise ... and for CEOs that believed in me to do it. Everything else good that happened followed from these two circumstances.

In the beginning, I didn't know about Arthur W. Page and the principles he espoused for our profession. Principals forged in the boardroom that, in my opinion, better describe what we do, or should do, than any text in print today. I certainly had no idea how well they would withstand the test of time.

It strikes me now that his point of view is as contemporary -- and I suppose some would say outrageous -- as it must have seemed 40 or 50 years ago... our profession has grown up to his view.

Think about it, as though he were among us today, he described the essence of public relations, practiced at its best, when he said that "public relations is a good story well told." For people at the top of the profession, it may be the most contemporary, direct and durable definition of our role because it focuses on the doing not the telling ... and because it recognizes an incontrovertible role for the latter once we do the former.

In our information-rich, transparency-insistent society, we may hold the most powerful positions in our corporations. And I believe others are rapidly coming to the same conclusion.

I am convinced, for example, that the dynamic convergence of information, media and business has changed the equation used to calculate our value. As a result, there has been a fundamental shift in the nature and inclination of the people who choose our profession as a career.

A new profession within the old. One that has responded to the changes in our environment and the needs of our corporate executives, and populated by a new profile of those who practice it...In our graduate program, more and more of those who apply are business graduates, rather than journalists...In our companies, more and more of our employees are coming with MBAs, or getting them on weekends and nights.

It is a result of our companies increased demands that we hard link what we do to what they do, unlike our peers, general counsels, heads of HR, or the CFO...our job title hasn't automatically put us at the policy level of our corporation, but that is changing.

This is not lightly stated or easily done, and for many is not new or different, but for the profession as a whole, this is a major change...a fundamental shift in who is entering the job progression and what characteristics are valued by those who direct our businesses.

All my professional life I have thought of us -- you and I -- as business people with powerful tools to influence business outcomes. It is gratifying to know that other business people are beginning to see us the same way.

My point is that our profession is turning into the one that Arthur Page did describe over 40 years ago. We increasingly enjoy the respect of peers in line management because we understand the business of the business ... because we want to be accountable for business outcomes rather than communications outputs ... because we want to use our skills to produce and protect revenue ... and because we are serious about advocating for our publics in the decision process.

Paradoxically, our peer reviews are getting better as media influence diminishes and corporate credibility wanes.

Even the bad news is good news for us. We live in a world where information is delivered instantaneously and invasively. Inflamed by a few miscreants, public trust of corporations is at an all time low. The media, after a few months last year of forced interest in real news and real reporting, has gone back to front pages that are more entertainment than news...television news, while now considered more credible than print, seems to be more interested in the newest movies than our changing economy...and our top news magazines are rapidly moving towards the supermarket racks. Is it any surprise that as all circulation and viewer ship continues to drop, an increasing number of the public seems to be cobbling together their own news sources.

The media has lost its exclusive right to represent the public interest. The Internet and other more direct sources of information clearly are gaining as interest in real, unbiased news builds. Who or what will fill this vacuum?

As a member of the NYSE's Special Board Committee on Corporate Governance, I spent part of this afternoon listening to a series of individuals and organizations listing their grievances and solutions surrounding our current loss in the publics' confidence. I can tell you what you already know. Over on our side - the company side - miscreant behaviors on the part of analysts and auditors, CEOs and CFOs, current employees and former ones are fueling public distrust of our companies.

Confidence in our markets seems to have remained in tact, but many stakeholders think our management is out to do one thing: line its pockets at their expense. The stakeholders pay big salaries and incentives on the upside. Yet they seem liable for a disproportionate share when management screws up or a market turns south.

Not surprisingly, all this has spawned a heightened level of interest in corporate governance. There seems to be a race between our legislators and regulators to see who can find the solution, who can corral our corporations. Most of these proposed solutions break down into two camps...increased regulations and requirements for corporate officers, boards, and auditors...and closer to our home, increased transparency, more understandable disclosure, more direct, unfiltered, unbiased information for our shareholders, and employees. It is leading to an unprecedented level of responsibility and challenge for corporate communications.

Some yet to be published research suggests that they really don't trust anything they hear from us, or the media...they don't trust CEOs, and don't really know what boards or committees do...they believe that self interest colors everything. This is a result of how they believe some of us have behaved and will not be solved by words alone.

Many companies do not understand the impact of this convergence of events, technologies and information sources. Most profoundly, their ability to "control" the message, and thereby persuade audiences to buy or sell, join or leave, lead or follow, has been severely diluted. Not only that, but their ability to maintain secret information no longer exists. Companies, whether they like it or not, are more transparent than ever...media, analysts, individual investors with Internet access, especially our own employees, are making sure there is no place to hide.

Just by way of illustration, a survey of public companies conducted last year revealed that 44% of the employees responding feel comfortable reporting misconduct -- real or perceived -- on the part of their employers. That's up more than a third from the year before. No telling where the number is post Enron ... but I'll wager it is higher today and rising.

These realities give credence to the enormous step forward that the profession is experiencing today. We have a long way to go, for sure. Many companies and, unfortunately, many of their professional communicators are forced into the old media-centric model where the focus is on media reaction first, company pro-action second.

In this day and age, I will argue that we need to reverse the focus. For one thing, the public no longer trusts the media to be its eyes and ears. For another, the media is no longer the sole or, in some instances, even the prime distribution system for our messages. What I am suggesting is that we need to adopt the view that Page understood implicitly: corporate stories are only as good ... or as bad ... as corporate behavior.

That line of reasoning changes priorities for people in our profession and for the people who would ask us into the decision process. It is a profession that has moved from a Communications Model to a Behavior Model...It elevates us from managers of corporate speak to instigators of corporate action. It asks that we accept the responsibility for telling truth to power rather than pretending we have power over truth. And it demands that we use the tools of our trade to tell our stories directly to our audiences.

As a member of a generation of practitioners who see more grandchildren than reporters and more students than employees, my perspective on the evolution of the marketplace is somewhat unique.

For what it is worth, here is what I see.

First, there is no argument about corporate transparency. Digital technology and the explosion of information outlets it has created, the dramatic increase in public ownership, the equally dramatic downturn in employee longevity and loyalty ... all have contributed to a different optical environment. A meeting today between one manager and two employees qualifies as public to me.

Second, CEOs have become lightning rods. They are being held personally accountable for their companies' actions. And you may have noted that when CEOs leave to "pursue other interests" these days, the euphemism, in most cases, is used to disguise a behavioral issue, not a financial one.

Page believed that behavior is the ultimate determiner of reputation ... public perception ... public relations. And he also believed that the "Chief Executive Officer ... is responsible for its reputation ... for its public relations ... for what it does, what it says, and for what the public thinks about it."

From the sidelines, we have all seen what happens to companies and their CEOs when these principles are not taken seriously ... when companies and CEOs refuse to act, refuse to take responsibility and refuse to talk about it.

Contrast that with the immediate aftermath of September 11th. There we saw some wonderful examples of how real leaders behave during a real crisis. We witnessed what happens when corporate executives and public officials divest their arms length view of the public, put aside carefully scripted and legally approved reactions, and act like human beings. They were real people -- confused, hurt, angry -- and we knew it, even admired it because they behaved and spoke in ways that assured us they were taking personal responsibility.

When I put this strong visceral reaction along side the research I've been doing at Northwestern for the last decade, I am convinced that the public wants to see us get angry when something bad happens, that they want to see us worry about how it will effect them, and that they want us to make our decisions as their advocate. Indeed, they resent it when we leave the field to lawyers or legislators or a growing group of professional advocates. And they resent it even more when we duck the risks to protect our assets and let others represent their interests.

My third observation states the obvious. Our publics are more knowledgeable, more mature, more self-interested and thus more critical. I believe these self-evident facts prove my point: today's public is predisposed to reward truth and responsibility.

And there it is, the first, most important, most difficult Page principle: tell the truth. Tell it to the powerful inside and outside the company. Tell it to the CEO, to the board, to the employees, to the stakeholders... the media. And tell it without exception, without evasion, without equivocation. For there is no truth that goes undetected or unremembered given our long, traceable electronic memories. Moreover, since we now know that the value of a brand is calculated as a function of trust, truth is good business.

Certainly, truth can be hard to define. Some would say it is in the eyes -- and/or pens -- of its beholders: CEOs who are often isolated and under informed; corporations that are cultural defenders of the status quo; advocates who are masters of the anecdotal; and media who, almost by definition, are confined to the opposing view for headlines.

So, the issue really is behavior ... what we do ... how and when and in whose interest we act. Page said that, "Effective public relations is 90% doing and 10% talking about it." Some may say it differently, but the maxim itself is in no need of repair...it hasn't changed...the penalties have just gotten harsher...the strategies more interesting.

The old caution that has stopped more than one of us in our tracks, "don't overreact" may have been sound advise at one time...but today our publics are demanding that we do overreact...contrary to the old adage, you can beat a dead horse, and sometimes it may be the perfect strategy.

Advocacy is ours until we give it away...and then we all to often end up fighting even harder to get it back.

To that point, our studies have taken a hard look at companies in trouble ... big public trouble. It is quite clear that companies who behaved in the public interest came out of the problem better than companies who communicated in the company's interest.

So what does all this mean ... especially to those who will follow us into the top jobs in the profession? Thinking about the answer makes me green with envy.

Smart, communicative, successful CEOs are paving the way to a future that depends on actions that are transparent and in the public interest.

More good news for us. In an information-based economy, branding and marketing are considered too important to be the sole purview of advertising and marketing managers. Awareness is not an engine of real growth nor is it a real differentiator when it comes to reputation. In executive suites everywhere, brand management is a reality that involves a whole lot more than tag lines and ingenious pricing programs.

Have you ever heard a litany of horrors that is more suited to our skill set?

Well, I have always been a cheerleader for public relations. The principles to which we adhere are those that lie at the core of our corporations. For each of you who do it right, today more than ever, I am rooting for your power and influence to rise in these increasingly difficult and public times. I do so because business needs your wisdom and your integrity ... and because the public needs to know that the profession we practice, Public Relations stands for a serious, business focused, advocacy driven form of public representation, not the spinning flackdom that emanates from inside the beltway.

We are in the worst of times and the best of times. We have always been a contra-cyclical profession: when things get stressed, we get better ... and we gain influence.

Mr. Page believed that "All business in a democratic society begins with public permission and exists by public approval." and it is our function, our mission...to get that permission and then behave in a manner that allows us to keep it...

I am so proud to be in this line of work. I am so proud of what this Society has done to raise our level of contribution and our levels of self-esteem. I am so proud, so humbled, to be recognized by men and women who believe in the Page ideals. And I am so grateful that I was able to see my future by standing on the wise broad shoulders of the people who preceded me to this rostrum.

The journey is righteous and fulfilling ... and besides that it was a hell of a good time.

Thank you again for this incredible honor and for your patient attention to my ramblings.