DATE

16/02/17

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ANALYSIS

IN MEMORIAM – PATRICK VIGORS

by  CHARLIE METHVEN

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IN MEMORIAM – PATRICK VIGORS

by  CHARLIE METHVEN

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DATE

16/02/17

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ANALYSIS

Last week I attended the funeral of Patrick Vigors, Dragon Group’s Finance Director. Patrick had been with our business since its inception nearly six years ago, and had sat – quite literally, as well as metaphorically – at my right hand throughout those years. He sent out our first invoice, chased our first late-payer (month 1!) and paid our first payroll (month 2). He negotiated compromises, dealt with recalcitrant banks – often in inimitably Fawlty-esque style – and had extremely straightforward views as to the contributions of those we employed as the years went by. Perhaps not surprisingly for a former cavalry officer, Patrick’s world view, when it came to people, was stark and binary. He divided it into those who were “good news” and those who were “bad news”. Despite (or perhaps because of) not being much of a people person, he was very rarely wrong. I would have saved myself a lot of trouble and money if I had asked Patrick to act as a final filter before hiring any new member of staff. 

Many people at the funeral told me how much Patrick’s work at Dragon meant to him, as a final success story at the end of a long and winding career. It is a sobering thought that I spent more of Patrick’s last years on earth with him than anyone else – his widow; his children; his close friends. Both of which facts should, I think, make all of us consider our working lives very carefully. Unless we are fortunate enough to inherit enough not to need to work, our careers will form a larger part of the lives that we live than our mind is, perhaps, comfortable with accepting. For our own sake, we need to be clear that the work we are doing is meaningful to us. And that the colleagues we spend 10 hours a day with are people we find meaning in, can learn from, teach, laugh with and achieve together.

 

I learned a lot from Patrick – before starting Dragon I was a novice in organising the financial matters of a company, having worked in larger organisations before. I laughed a lot with Patrick, as he pointed out exasperatedly the iniquities and illogical working practises of modern business life. Along with all his much younger colleagues, I laughed at Patrick as he plucked extraordinary metaphors and 1950s-style language out of thin air to illustrate his points on the telephone whilst waving his arms around like a scarecrow on speed. At our annual Christmas party, of the ten ‘quotes of the year’ at least five would always be from Patrick.

We achieved a bit together too, growing a business from three people around a kitchen table to the twenty people I see in front of me, as I write this now, in a Mayfair office. As new members of staff join, they will not know of the man who, nearing 70, would stalk in every day with his ruck-sack and set straight down to work – never a day off for sickness, never a moan about his life, always determined to do the best he could do. But I and a few others will quietly raise a glass to Patrick Vigors whenever we get together, for being a force for good in all our lives.

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DATE

06/08/15

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ANALYSIS

THE VALUE OF STRATEGIC COMMUNICATIONS

by  PATRICK ELLIOT

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THE VALUE OF STRATEGIC COMMUNICATIONS

by  PATRICK ELLIOT

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DATE

06/08/15

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THE VALUE OF STRATEGIC COMMUNICATIONS

How to support litigation with strategic communications

Lawyers have for many years prided themselves on being commercial and fully attuned with their clients’ needs and businesses.  However, apart from those engaged in defamation or reputation protection, few lawyers regularly give much thought to how the media might affect their work.  More importantly, they rarely consider how external communications might be used to proactively support the work they are engaged in.  By giving this more frequent consideration, lawyers might more easily claim to be attuned.  At the very least they will be able to demonstrate a deeper awareness of some of the other issues affecting their clients’ businesses.

Why a media strategy matters

For certain types of legal transaction – where there are legal and/or business issues which are likely to attract media attention – a communications strategy is vital.  The strategy should address when and how and what key messages need to be delivered.  It will be determined and driven by the legal process and key events, but should identify the key media threats and how these should be negotiated.  This type of communications strategy should be aligned with a businesses’ long-term corporate PR strategy, albeit dealing with unique circumstances and pressures.

It will often be the case that a different type of strategy needs to be developed where there is potential litigation.  From the red tops to the pink pages, as soon as there is litigation the media see it as an opportunity to re-run historical negative information about the litigant.  Even before any guilt has been proven or dismissed the media can deliver a damning verdict, which hurts brands and individuals.

The well-advised client should try to get on the front foot, dictate the story and manage the information flow.  A commercially-minded lawyer should want to assist.  Lawyers and their clients may need to develop a much more dynamic strategy: pro-active, focussed on key objectives and targeted at key journalists and publications identified in advance

A communications team should also advise on the litigation proceedings, identifying the occasions when the media will be interested: when proceedings are being issued, during the disclosure exercise, when witness evidence is being exchanged and during any court hearings.  A litigation communications strategy should recognise all the possible threats and risks, as well as the opportunities which might arise on each of these occasions and plan for them. The effective legal team will buy into and help shape the communications strategy, which will be aligned with the legal strategy but always with the client’s business objective in mind.

The main objective must be the proactive use of media to obtain leverage and to help clients achieve their business goals. Lawyers are, after all, engaged to advise their clients and a legal team should consider all the tools at a client’s disposal every time that they are engaged. This is one way of differentiating themselves from their competitors.

Practical litigation support

Although there will be an over-arching communications strategy, there will be several practical steps which the communications team can take to assist during proceedings.

In the same way a lawyer does not like surprises and expects the client to disclose all information, a communications team should research and prepare ahead of any legal action.  When a client is in court accused of bullying employees, the photos taken ten years earlier which seem to show the person forcing an employee to lick his shoes (a real example), need to be disclosed.  The photos may not be used in court but when they are splashed across the media, the damage to the business is already done.  A good communications team can mitigate the damage, but only if they are briefed well in advance of the case going to court.

In most cases the earlier the legal communications team is engaged the better, but they can also provide support during daily proceedings by attending court and briefing the media at the end of each day.  This will hopefully prevent the situation when various journalists turn up to court and file their reports without having fully understood all the issues which arose.  How many lawyers have seen well-respected publications send journalists to court and then read articles which don’t relate to the issues or miss key nuances?  I suspect that most litigators have.

The communications team can also get engaged in several other activities. Some of these will include asking questions of authorities (governmental/financial/regulatory) through the media, undermining the opposition’s reputation, responding to press enquiries, highlighting injustices, querying the viability and integrity of legal and financial proposals, helping to minimise and re-direct press focus and helping to build a group of interested parties (for example creditors or class action claimants).  The team might also help to exert pressure on litigants to settle matters and work with investigative journalists minded to ask awkward questions. These activities can be undertaken in diverse ways depending on the type and nature of the litigation, as highlighted below.

Types of dispute

  1. Financial disputes

The main objective in most financial disputes is to seek some form of financial recompense. However, enhancing or protecting a reputation is often a key part of the strategic goal. Reputations are most easily enhanced or damaged in the media and a winning litigant may suffer damage to its reputation in any event. There might be revelations in disclosure or during cross-examination when embarrassing information is exposed. Although a party might win a case on legal grounds it could be at the cost of damage to their reputation if they reveal less than positive details of their operations. If potential shareholders and/or lenders decide not to invest in a business as result this could be highly damaging.

Litigants need to therefore always consider whether there might be a potential media interest during a case and how to manage it.  Planning ahead and having a detailed plan of how to respond to all likely eventualities is key. The communications strategy should anticipate the sensitivities and provide a means to avoid suffering damage, even at the expense of some legal steps. This means planning to be on the front foot and not being surprised at any stage.

There have been significant numbers of claims against banks and financial institutions for distinct types of mis-selling and manipulation over the last few years. Although the big banks have lost some of these and made many compromises with claimants, they have also won some of the cases. The wins have not, however, helped them with their reputation and reversed the negativity associated with them. Instead, every claim levelled against them has increased the public perception that they are at fault and have acted wrongly. This is an extreme example where it is unlikely that any amount of media work would alter the public perception of these institutions but a media strategy has clearly been essential, if only to admit fault in the least toxic manner.

  1. Fraud

Although a subset of financial litigation, at least in its non-criminal form, there are features of fraud disputes that lend themselves to a distinct approach to the media. Fraud sells news and fraud associated with a well-known business or individual sells well. A litigant can easily sully another party’s reputation if there are allegations of fraud as part of a case. If the other party has a track record of questionable actions this is even better and can be exploited. Merely having a journalist ask probing questions of a party pre-publication might be sufficient to bring about a settlement.

  1. Restructurings

For large-scale restructurings and insolvencies, especially cross-border cases, media pressure can help shape the outcome of the case. If there are significant assets at stake it may be that there are macro-economic and/or political considerations, both local and national, at stake and all sorts of authorities may be involved. In those circumstances the media might be used to exert pressure or to question the policies and effectiveness of those authorities.

During the years following the financial crisis of 2008 there were several significant financial failures whose resolution was influenced by the media. There must have been as many column inches in the media about the Lehman collapse as there were lawyers involved in it.

In Iceland, the media played a key role in persuading the Icelandic authorities to reach a compromise with creditors of the three failed banks, Glitnir, Landsbanki and Kaupthing. Initially the Icelandic authorities were minded to dismiss junior creditors (largely bondholders) as beneath their interest and to impose a plan of their own backed up with local legislation, particularly when well-known distressed investors, mostly hedge funds, bought positions in the banks’ debt. However, after a few years of the international media suggesting that Iceland needed to re-join the international financial community, that it needed to behave in the same way as other sovereign bodies and that if it didn’t it might suffer further damage to its sovereign rating, the Icelandic authorities agreed compromises with those creditors. Yes, the creditors took haircuts but they received a payment on their debt securities and Iceland is in the process of re-opening its financial markets to foreigners.

  1. Divorce

Another area ripe for media coverage, provided the court allows it, is divorce. The more money at stake, the more likely the media will be interested. This is likely to be both the legal and national press and a certain amount of pressure can be brought to bear accordingly.

Conclusions

Whatever the nature of the litigation, it is important that the legal team works closely with the communications team so that neither surprises the other and each is clear about the ultimate goal. This is sometimes harder than it seems. During proceedings, while a legal team may want to win at all costs, the route to that victory may significantly damage a client’s reputation. Disclosure can be a surprising and detrimental process to both parties.

The more commercially aware lawyers will be cognisant of this type of risk and they will want to work with the communications team. They may choose to instruct the communications team directly to enable their client to take advantage of privilege, to the extent it applies. They should insist upon being consulted on the media strategy in any event.

However the relationship is managed, lawyers should be aware of what a good communications strategy can achieve and why it needs to be considered as a tool whenever a new instruction is received.

Patrick Elliot, formerly a restructuring partner at Brown Rudnick, heads Dragon Advisory’s Special Situations team.

 

The communications strategy may utilise a number of tools. These include background briefing journalists (off the record), working with investigative journalists, lobbying, rebutting negative press coverage, monitoring the press and working with a client spokesperson. All of this should have traditional and digital media in mind.

What is clear is that being reactive and/or the absence of a strategy does not benefit a client.  “No comment” and avoiding the press are perceived negatively and it is usually best to be on the front foot.

It is important that the legal team works closely with the communications team so that neither surprises the other and each understands what their respective and the client’s goals are. This is sometimes harder than it seems. In proceedings, while a legal team may want to win at all costs, the route to that victory may significantly damage the client. Disclosure can be a surprising and detrimental process, even where a claim is successful, and a client may lose investors or suffer damage to its share price in the process. The legal team should work closely with the communications team to minimise any negative coverage.

The more commercially aware lawyers will be cognisant of this type of risk and they will want to work with their client’s communications team. Where there is litigation, they will directly instruct the communications team so all can take advantage of privilege where it applies.

Developing a communications strategy in tandem with a legal strategy is a relatively new concept to many businesses and many lawyers. The most commercially aware lawyers will be aware of what a good communications strategy can achieve and will suggest its use to their clients at the outset.

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DATE

06/08/15

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FUTURE

FUTURE OF PUBLIC RELATIONS

by  CHARLIE METHVEN

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FUTURE OF PUBLIC RELATIONS

by  CHARLIE METHVEN

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DATE

06/08/15

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FUTURE

Public Relations has a PR problem. Some 30 years into our trade’s existence as an industry, many business leaders have formed a view of PR that would optimistically be described as cynical.

In the advisory food chain, public relations advisers generally rank below lawyers, accountants and management consultants, with maybe only estate agents and IFAs scoring lower credibility ratings.

Part of the reason for this is, ironically, perception. PR is not a profession; it is thought to be dealing with less objective matters than the legal and accountancy industries; and it still generally attracts a lower class of university graduate than its professional peers.

All these things matter a bit, but I believe that the major problem is a structural one, which can only be addressed by those of us running consultancies. Fundamentally, PR has not actually generally done – or even tried to do – what it might be expected to do.

Consider the term “Public Relations”. See how broad it is. How all-encompassing. That does not suggest a narrow, flakey function dealing with non-core issues. It suggests dealing with all the externalities that a business might face, presumably in a coherent, strategic fashion.

So why have PRs allowed themselves to be backed into a corner where “media relations” is seen as about the summit of what they might be allowed to get their mitts on?

Whereas management consultants deal largely with the minutiae of a company’s systems and processes, with lawyers and accountants focusing on issues specific to their training, Public Relations is gazing at a broad universe. It comprises commercial ambitions, major risk mitigation, engagement with clients, partners, investors and politicians through any number of channels – in short, outside of the inner workings of a business, the whole shebang.

It is a fascinating challenge to consider all these contexts, and make sense of them together. A huge opportunity if a business leader takes a PR adviser seriously enough for him/her to impact a business positively, rather than just tidy up around the edges (as the legal eagles and bean counters will always be limited to doing).

That was the opportunity I was shooting for when I set up Dragon in 2011. It is an opportunity that has become even greater with the further progression of the digital age and consequential gradual retreat of paid-for advertising, to be replaced by proprietary digital content and social media channel usage. These new channels should rightly be part of the PR’s toolbox, not the province of traditional ad agency types. How, realistically, can one separate the writing of a comment piece for the chief exec from putting together a YouTube clip expressing the same message?

Ultimately, all these channels – traditional newsprint, blogs, social media, events – need to be considered as one, by one function. Otherwise, a business leader will constantly be having to worry that the right and left hands are being governed by different brains, diluting or contradicting the message in the process.

A true PR supremo needs to look across all these channels, whilst keeping a steady hand on the strategic tiller. Being a “digital PR” is no better than being a “newspaper PR” because channels are just that; channels.  They are not the point themselves. Yet it is true that, with such a broad range of different tactical competencies – and such a major chunk of corporate territory – to become what the clients need them to be PR consultancies need to aim higher than they are used to doing. We also need to recruit more intelligent graduates and experienced colleagues from a broader range of backgrounds.

This isn’t easy. Until PR captures the territory it should do, with consequent higher fees, consultancies will struggle to pay sufficiently well to hire the very best. This is going to be a gradual process. None the less, amongst Dragon’s ranks we already count a former major law firm Partner, a former Hedge Fund Partner, a former in-house investor relations manager, two former national newspaper journalists, a former Chief Marketing Officer, a former F1 team head of sponsorship, as well as five ‘career PRs’. The team meetings become richer and more productive with the addition of every different skillset and different primary career.

I hope and believe that, in the process of building a team that can seriously address our client’s full needs, we are also finally starting the long-overdue task of solving PR’s PR problem.

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