Issue 02/2013 preview by Dafydd Phillips

COMMUNICATION

www.communication-director.eu

DIRECTOR

Magazine for Corporate Communications and Public Relations

02/2013

Finding the right path Ethics and values in corporate communications

Communication breakdown in the great communicator Public scandals show the private side of organisational culture

Introducing corporate historical responsibility

The ethical dilemma of confronting dark corporate pasts

Making a stand at work for whatâ&#x20AC;&#x2122;s right Finding the courage to give voice to your values

LAURENT FREIXE NESTLÉ

MARK PFITZER FSG

MARGARET O’DONNELL BRITISH RED CROSS

STEFANIE WETTBERG BASF

MARIE-GABRIELLE CAJOLY ADDAX PETROLEUM

MARK ARIS DIAGEO

MELISSA FLEMING UNHCR

MELISSA LAMSON LAMSON CONSULTING

ANDREA POLO FAHIMA CHERAFEDDINE IMMOBILIARE.IT COMMITTEE ON THE FOLLOW-UP ON WOMEN’S ISSUES

KLAUS FRIDORF NORDEA

PHILIPPE BORREMANS VAN MARCKE GROUP

ANNABELLE ATCHISON MICROSOFT

MICHELE GALEN NOVARTIS

THOMAS SCHULTZ-JAGOW AMNESTY INTERNATIONAL

REGINE COQUERAN-GELIN ALCATEL-LUCENT

STACEY MINTON CELGENE

EUROPEAN

COMMUNICAT ION SUMMIT2013

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AURELIE VALTAT COUNCIL OF THE EUROPEAN UNION

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MARC LANGENDORF SIEMENS

SUSAN SHEEHAN NOKIA

THIERRY NICOLET SCHNEIDER ELECTRIC FRANCE

IAN MCNAIRN IBM

TOM WATSON BOURNEMOUTH UNIVERSITY

ULF SANTJER PUMA

WWW.COMMU N I C AT I O N - S U M M I T. E U

EDITORIAL

oday’s communication professionals are sometimes called upon to engage in work that, though legally acceptable, can often be less concretely-def ined in terms of ethics. Furthermore, the push towards transparency and compliance rules that has taken place over the past few years means that questions of ethics are more relevant to communicators than ever before. Ethical issues are regularly encountered by professionals working in the f ields of governmental relations, lobbying and public affairs, while the increasingly globalised world of business can bring certain practices into direct conf lict with ethical codes. Furthermore, digital channels of communication and social media phenomena have further clouded the issue of exactly what the appropriate ethical response should be. So how do today’s communicators address the practicalities of ethics in their day-to-day work? This issue of Communication Director has invited a handful of experts from the professional and academic f ields to contribute their opinions on this subject. The corporate code of conduct is a recurring theme, though there is ambivalence as to their effectiveness. A nuanced take on greenwashing gives us a greater understanding of how such a situation could arise, and a case study of corporate whistleblowing is presented as part of a wider strategy of transparency and trust. We also look at the ethical and public relations challenges presented to today’s communicators by dark corporate pasts – a fascinating and relatively recent addition to the business landscape. We also hear about how we ourselves can f ind the courage and conf idence to stand up, give voice to and act on our own set of values, proving that, when it comes to doing the right thing, it is often up to individuals to take the initiative. A subject as rich as ethics can only be partially touched on within these pages: we hope that these articles inspire you towards further contemplation.

Marc-Oliver Voigt Publisher marc-oliver.voigt@communication-director.eu

Photo: Moritz Vennemann

02/2013

COMMUNICATION DIRECTOR

“The increased importance of engaging with non-traditional stakeholders will require changes from communicators.”

AGENDA SETTER Communication ideas in the eyes of experts

“Frustration is most acutely felt by those who care about individual or organisational goals the most.”

Opening up the ofﬁce

Helping employees overcome their workplace frustrations is good for business

Mark Royal and Tom Agnew

Why Microsoft loves ﬂexible workstyles

THE STORY OF PR

LEADERS CEOs in the eyes of the media

Break the chains

CEO Stockwatch

Looking back at landmark communications

by CARMA International

The development of Norwegian PR Scandinavian ideals of egalitarianism and equality have driven public relations in Norway

Gillian Warner-Søderholm and Tor Bang

STRATEGIC THINKER The corporate and academic stand on communication

Do you measure up? Comparing the competences of professional communicators across Europe

THE BIG INTERVIEW Key communicators under the spotlight

Stakeholder success Why companies must engage with non-traditional stakeholders

Truus Huisman and Phil Riggins

TEAM PLAYER

How to improve personnel management and your career

Aristotle, the Industrial Revolution and our understanding of information ethics

Antonio Marturano

Ralph Tench and Hasina Juma

On the evolution of information

Adding up the numbers There is real value in getting your employees ﬁnancially informed

Ann-Kathrin Halvorsen

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Laurent Freixe Executive Vice President, Zone Director for Europe, Nestlé Photo: Chriscrowley | Dreamstime.com

“How can organisations start addressing a dark history after long periods of silence?”

“Norway experienced strong elements of patriotism and propaganda in its external communication endeavours.”

STORY TELLER Looking at the important questions of communication

Between ethics and morality Communicators increasingly face ethical dilemmas, yet there is confusion about to how move forward

Dafydd Phillips

Mary C. Gentile

80 84

ASSOCIATION European Association of Communication Directors

Photo: Dreamstime.com

The latest developments in the EACD

QUESTIONS TO...

Ignacio Ferrero, Dulce Redin and Reyes Calderón

Establishing a channel for whistleblowers is one way of gaining trust

Book Reviews

Confronting a dark corporate past presents an ethical and public relations dilemma to communicators

Some corporate codes of conduct are more concerned with control than with ethical behaviour

Sounding the alarm

88 COMMUNICATIONS READER

A journey to justice

Speaking in codes

A case study of how public scandals can ﬂag up issues of organisational mismanagement

Jan Larsson

Claudia Janssen

An unhealthy state Barrie Gunter

Playing to my strengths Finding the courage to speak out and act on our values begins with self-assessment

The spiralling logic of responsibility The pressure put on companies to be socially responsible can lead to accusations of greenwashing

Henrik Merkelsen

When prevention is better than cure A code of conduct can help a company protect its reputation and business

Peter O’Brien

The personal side of Communication Directors

Multidimensional moral decision making The various ethical theories managers use when faced with an ethical dilemma

Johanna Kujala and Anna-Maija Lämsä

Vanya Babanin Head of PR and Corporate Communications, Balkan Star Automotive

02/2013 COMMUNICATION DIRECTOR

STRATEGIC THINKER The corporate and academic stand on communication

DO YOU MEASURE UP? A comprehensive new project compares the competences of professional communicators across Europe. By Ralph Tench and Hasina Juma

ompetency is a good thing. It means you can do it. Think of sports, playing an instrument or being able to fly: if you are competent then you will fit the general view that you can handle the task, issue or challenge in front of you. So what does competency mean when we talk about our work? Our recent study has highlighted that there are significant gaps in the shared knowledge and understanding of the issues when it comes to our own professional capabilities, particularly in communications. Supported by the EU and working in partnership with the European Association of Communication Direc-

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tors, the European Communication Professional Skills and Innovation (ECOPSI) programme is the largest European-funded communications project looking into the future skills and competence needs of practitioners. The aim is to influence both theory and practice and has involved 12 months of fieldwork, which some readers will have been involved in. We recognise that there is a changing context for communications. For example, the position of the chief communication officer on the board of large organisations is becoming more common as communications is being seen as integral to the financial and commercial success of organisations. The communication officer champions the benefits of effective communications through demonstrated return on investment

STRATEGIC THINKER

while internal communication managers are increasingly being asked to help support, implement and drive organisational change through employee engagement and communication activity. Other communication professionals, such as crisis communication managers, face a new reality where a simple mistake can escalate into a crisis in our hyperconnected society. Similarly, social media managers are now responsible for maintaining the integrity, trust and reputation of their companies in the rapidly emerging digital world. These new corporate positions clearly demonstrate that communicators now require a complex set of competences to be successful in a global workplace which is currently undergoing phenomenal change, driven largely by pressure to improve profits and to make cost efficiencies. A partnership of six leading European universities, the ECOPSI programme is focused on mapping the current competences required for social media roles, internal communication roles, crisis communication roles and communication director roles in Europe as well as understanding their future development needs. The research team members were professors Ayla Okay, Ansgar Zerfass, Piet Verhoeven, Angeles Moreno, Dejan Vercic and Ralph Tench, and the programme reflects 15 months of desk and empirical work by the team in three core phases: (1) the benchmarking report in each country region; (2) quantitative data collection from communication practitioners in 42 countries across Europe; (3) qualitative data from 53 interviews from four senior practitioner roles in the six regions of the study. This article highlights four emerging trends that resulted from the interviews.

I. STRATEGIC SOCIAL MEDIA As organisations seek new ways to drive innovation and build authentic relationships with their various stakeholders, many decide to jump on the social media bandwagon. Some organisations are experts in surfing the social media wave while others struggle or fail. Our study found that practitioners, especially chief communication officers, feel they need a greater understanding of its strategic application and want to find out more about the return on investment that might be realised from their implementation rather than knowing how to use a specific social media technology or platform. This finding links with the fact that all regions view social media as a growing area: not all are necessarily viewing this as a threat, but more as another media channel to use. This is particularly the case in Germany. In contrast, Spanish communications professionals possibly need to hone their negotiation and conflict resolution skills as a result of what is happening in their own troubled economy and the subsequent labour market tensions. The top three knowledge, skills and personal attributes for social media managers in Europe are listed in the table on the next page. When asked what would be the best ways of improving knowledge in these areas there were also some interesting variations according to job role. For social media managers this could take the form of self-study using the internet or perhaps attending specialist short courses. Chief communication officers and a number of crisis managers felt that the best way to develop their knowledge was to

These new corporate positions demonstrate that communicators now require a complex set of competences. talk to peers or (younger) members of their own team already working in this area, as well as by hiring new people (or in one instance a team of people) with this specialist knowledge. Some of the most popular ways to develop skills include on-the-job experience in current and previous roles and self-study using books and online resources. Opinion varied amongst respondents as to whether personal attributes are something that training and development can help to improve. Some respondents felt that personal attributes could be improved. There was an understanding that this can take hard work and concerted eﬀort while others thought it was part of an individual’s character. 02/2013 COMMUNICATION DIRECTOR

TEAM PLAYER

How to improve personnel management and your career

ADDING UP THE NUMBERS Getting employees ﬁnancially engaged not only helps them make informed decisions but also builds better relations at work. By Ann-Kathrin Halvorsen

ew managers would argue that employee engagement and involvement are important factors in a company’s performance. Numerous studies over the years have shown the link between employee engagement and improvements in productivity, performance, customer service, retention, and even the ﬁnancial health of a company. Managers the 02/2013 COMMUNICATION DIRECTOR

world over have taken this to heart and have put engagement on the corporate agenda. Yet, there is one area that leaves many employees feeling disengaged and downright powerless – understanding the company’s ﬁnances. In the spirit of transparency and

TEAM PLAYER

openness – two often cited drivers of employee engagement, we throw difficult financial terms and concepts at employees and expect them to understand and take appropriate action. Instead, employees very often feel intimidated and ill equipped to make the decisions that can have a positive influence on the bottom line. Invariably, employees feel that the only way they can contribute is by cutting costs. Feeling forced to resign to such a Sisyphean situation and not being able to influence your work conditions can be downright demoralising.

WHY MANAGERS SHOULD CARE The frustration and lack of

empowerment that financial communication very often causes is unfortunate, as a company’s financial performance is closely linked to its overall performance and strategy, and serves as an important way to measure progress. Although, when given the opportunity, employees can do more than merely take part in cost cutting exercises, taking a hard look at operating expenses is a reality that many companies are facing in these uncertain economic times. American Electric Power in the US decided to invite their employees on their cost reduction journey a few years back. By explaining to their employees the reason behind the cost cutting measure in a simple and compelling way and providing them with the tools to contribute ideas, the company exceeded the necessary 1.7 million dollar cost cuts by several million dollars. However, it doesn’t have to be all about costs. As with other parts of the business, when employees feel involved and truly understand the road ahead they will make informed decisions that support the strategy and help reach an organisation’s fi-

nancial goals. For instance, let’s say you put effort into making sure staff in the research and development department truly understands the impact that delays in product launches can have on sales. This will help them be more motivated and better able to make sound decisions during the development process in order to maintain speed to market. Annual budget processes – usually a highly politicised affair in many companies – can also be made far less painful for everyone through improved financial literacy. When creating cost budgets and forecasts employees will be able to run different scenarios by adjusting recruitment and campaign dates, and suggesting which expenses can be capitalised as opposed to classified as operating costs. This will not just reduce the frustration felt by finance managers over the quality of budgeting, but also instil confidence and ownership in the employees who will be responsible for sticking to the budget. Armed with the right tools and the right knowledge, sales personnel will be able to confidently balance pricing and discounts versus volume increases and take into account the cash flow effects of credit extensions.

KNOWLEDGE IS POWER Improved financial literacy also helps build better relationships between management and labour groups. If you make the economics behind the entire supply and value chains as well as the realities of the financial markets more transparent to employee groups, you will increase the understanding of all the forces that can have an impact on a company’s financial health. Armed with this better understanding, labour

Improved ﬁnancial literacy also helps build better relationships between management and labour groups. groups are more likely to actively contribute to business growth. Management will of course have to contribute in order to become a trusted business partner, but improved ﬁnancial literacy will build a solid communication platform which beats perpetuating the traditional antagonistic relationship between management and labour groups. A good example of this in action is AirAsia X, a low-cost long-haul airline based in Malaysia. Management was able to create true engagement among the pilots by ensuring their understanding of the impact that fuel costs have on their business model. The pilots, a traditionally strong employee group in many airlines, are now actively 02/2013 COMMUNICATION DIRECTOR

TEAM PLAYER

BREAK THE CHAINS It is important not to let workplace frustration undermine your investments in employee engagement. By Mark Royal and Tom Agnew

aced with increasing competitive pressures, today’s organisations are challenged to optimise returns on all investments. But when it comes to getting the most from eﬀorts to engage employees, many are not realising desired results. Worse yet, many aren’t even aware of the problem. Employee engagement has become a major focus for leaders and managers in many organisations, for a number of good reasons. By drawing out the discretionary eﬀorts of employees, engagement holds out to organisational 02/2013 COMMUNICATION DIRECTOR

leaders the prospect of increasing productivity. Likewise, an engaged workforce that is aligned with goals and objectives is a resource for responding eﬀectively to change and the many unanticipated and ambiguous problem-solving and decision-making situations it brings. Finally, with more and more employees looking for environments where they can be energised at work

TEAM PLAYER

and feel that they are contributing in a positive way to something larger than themselves, many organisations view creating high engagement workplaces as key to attracting and retaining needed talent. Hay Group has partnered with Fortune magazine since 1997 to identify the World’s Most Admired Companies and to identify the business practices that contribute to their strong reputations and performance. In a recent study of executives in eligible companies, the vast majority indicated that employee engagement is an explicit part of their company strategies (86 per cent), is incorporated into management development programmes (85 per cent), and is a consistent focus beyond employee survey eﬀorts (86 per cent). Clearly, organisations are investing heavily in creating high levels of employee engagement. And many are having success. Hay Group’s global employee opinion norms, comprised of data from over ﬁve million employees worldwide, indicate that 66 per cent of employees currently report feeling engaged at work. The problem is that too many engaged employees in today’s workplaces are also frustrated employees. From a motivational perspective, managers have these employees where they want them. But when it comes to ensuring that they are as productive as possible, organisations are missing out.

Photo: Chriscrowley | Dreamstime.com

WORKPLACE

FRUSTRATION

Frustration is a common emotional response to opposition, when the human will seeks a certain fulﬁlment but cannot get what it wants. We all experience frustration on a daily basis, both in our personal lives and at work (the lack of an available parking space, an uncomfortable chair, or a thermostat never set at the

right temperature). But the more important a particular outcome or objective is perceived to be, and the stronger the will to achieve it, the deeper the anxiety when it is not realised. Frustration over the inability to achieve signiﬁcant individual or organisational goals is more troubling than the annoyances associated with our daily routines. And when held back by work environments that hinder performance, frustration is most acutely felt by those who care about individual or organisational goals the most: that is, highly engaged and motivated employees.

THE ENEMY OF ENGAGEMENT Based on Hay Group research and experience, there are a lot of engaged but frustrated people in today’s organisations. Indeed, Hay Group data indicate that frustrated employees make up 20 per cent or more of the workforce of a typical company. That may not sound like a lot. But it means that a in a mid-size company of 1,000 employees, fully 200 want to do more than they are able to deliver. At a time when organisations are struggling to get the most out of every available resource, including human capital, that’s a tremendous loss of employee productivity. Yet the problem is commonly overlooked. Insofar as employee opinion surveys and other employee feedback programs have traditionally focused on employee satisfaction, commitment, and engagement, they commonly fail to highlight issues related to the supportiveness of work environments. And frustrated employees are often reluctant to voice their

Frustration is most acutely felt by those who care about individual or organisational goals the most. concerns in other ways. Highly committed to their employers and their jobs, they may be disinclined to make waves by complaining about their situations – and those who do speak up may be unlikely to press the point if work arrangements are seen as unlikely to change. As a result, many suffer in silence. Given the tension involved for employees, frustration is an inherently unstable state. Where strong motivation to succeed is not paired with similar levels of support in the work environment, employees can be expected to respond in one of three ways – most often within a time span of 12 to 24 months. It is true that some employees may, through force of effort, find ways to break through the barriers presented by low levels of support and upgrade their work arrangements to match their motivational levels. But oth02/2013 COMMUNICATION DIRECTOR

THE BIG INTERVIEW Key communicators under the spotlight

LAURENT FREIXE Executive Vice President, Zone Director for Europe, Nestlé Interview: Dafydd Phillips

You joined Nestlé in 1986. What is it about this particular company that has kept your interest for this amount of time? Nestlé offers the unique opportunity to work for a truly global company with very strong roots in most countries and with a respect for different cultures. Nestlé is a company focussed on the long-term, a company where people are more important than processes, a leader in nutrition, health and wellness, offering the possibility of multiple functional and geographical experiences, a company with very strong values to which I fully identify and I can easily embrace. 02/2013 COMMUNICATION DIRECTOR

Proficient in several languages, you have worked for Nestlé in several different locations in Europe: France, Hungary and Spain. What do you enjoy most about this kind of international career? The unique chance to discover very different geographies, cultures and the diversity of our European heritage, whilst developing the presence of our company for the benefit of our

THE BIG INTERVIEW

challenges do you face in your work when faced with the many different cultures and mentalities present in such a diverse region? The strength of Nestlé in Europe is our alignment behind a common agenda, with priorities deﬁned centrally every year. At the same time it is critical to stay locally relevant, and to embrace every country’s own reality. The local markets are in charge of the adaptation to the local environment and they are in charge of the local execution. A strong central vision helps our markets make the right choices and leverage our strength and footprint as a global player while being intimately connected to the local environment.

Photo: Nestlé

Today’s European context is not an easy one. How should Europe face the current ﬁnancial and economic crisis? It is true that the ﬁnancial and economic crisis has presented Europe with existential questions. Also, our ageing society, growing unemployment and the increasingly limited availability of natural resources challenge existing paradigms. But every crisis is an invitation to fundamentally rethink our ways of working. As a priority, we need to agree on the concrete long term targets, objectives and the reforms necessary to encourage economic and social development. In that sense, I strongly defend the Commission’s EU 2020 vision of smart, sustainable and inclusive growth as a starting point. This is a vision which I am convinced the rest of the world will embrace sooner or later. I am also convinced that the answer to the crisis should not come from policy makers alone. We need an approach that involves all of society, including business, and the competitiveness of our industries should be at the forefront, as there is no sustainable development without competitiveness.

local people, consumers and suppliers. One should not underestimate the eﬀorts and investments done by Nestlé to promote a strong business ethic and train and develop our employees in the long term. Working in all these countries has been a new adventure every time.

How can large companies find a way of growing in this climate? First and foremost you must have the conviction that you can generate growth in Europe. At Nestlé, we have not written off Europe. The best sign of it is our historically high level of investments in production capacities, but also research and development and in building the capabilities of our people. Last but not least, by investing behind our brands, which we roll out first in Europe then across the globe. One of the best recent examples of this is Nescafé Dolce Gusto, first launched in Europe, now present in every single European market and going global.

In your present position, you have panEuropean responsibility. What kind of

And what messages should they be communicating at this difﬁcult time from your point of view? 02/2013 COMMUNICATION DIRECTOR

STORY TELLER Looking at the important questions of communication

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STORY TELLER

FINDING THE RIGHT PATH Ethics and values in corporate communication “Between ethics and morality” by Dafydd Phillips page 52 – 55

“When prevention is better than cure” by Peter O’Brien page 56 – 59 “Playing to my strength” by Mary C. Gentile page 60 – 63

“Journey to justice” by Claudia Janssen page 64 – 67

“Speaking in codes” by Ignacio Ferrero, Dulce Redin and Reyes Calderón page 68 – 71

“Multidimensional moral decision-making” by Johanna Kujala and Anna-Maija Lämsä page 72 – 75

“The spiralling logic of responsibility” by Henrik Merkelsen page 76 – 79

“An unhealthy state” by Barrie Gunter page 80 – 83

“Sounding the alarm” by Jan Larsson page 84 – 87 51

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COMMUNICATION DIRECTOR