Greentarget

Authoritative messaging

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How consultants can use an ESG communication strategy to differentiate themselves in an increasingly competitive marketplace  

As investors, regulators, and other stakeholders demand enhanced transparency—and progress—around environmental, social and governance (ESG) goals, a new market has exploded to offer support: ESG and sustainability advisors. In fact, spending on these services is poised to hit $16 billion by 2027, up from $6 billion in 2021, according to research firm Verdantix. 

Professional services providers—consultancies, accounting firms, financial services companies, BigLaw, and boutique shops alike—are all jumping into the fray. Today’s leaders include members of the Big Four (PwC, EY) and global environmental consultants like ERM, while any number of fund administrators, shareholder advisory firms, and credit rating agencies are also vying for ESG-related business. That’s driving deal activity in the space: from 2019-2021, there were over 18 sustainability consulting acquisitions, while the past two years saw financial services firms spending more than $3.5 billion buying green-ratings companies and data providers.  

Yet demand breeds competition, and competition demands differentiation. Despite the diverse array of providers, most offer a similar set of services, including ESG reporting, screenings, training, risk assessments, and tax solutions. At the same time, the outlook around ESG is getting more complex amid political and investor pushback.  

How can these firms differentiate themselves in an increasingly crowded and fast-evolving marketplace? At Greentarget, we’ve worked with professional services firms, financial institutions, and consultants advising clients on ESG-related issues to establish unique positions of authority that help them do just that.  

ESG Advisors Need Authority Positioning  

Professional services firms—be they management consultants, law firms, financial services companies, or ESG advisors–-tend to look a lot like their market competitors. They offer similar capabilities and target the same types of clients. Even the mission statement isn’t much of a place to stand out—unsurprisingly, advisors targeting ESG business all talk about their commitments to ESG and to diversity, equity, and inclusion. 

Differentiation, then, becomes a challenge. Unlike consumer brands, few professional services firms want to (at least overtly) compete on cost. Creative branding for these relationship-driven firms only goes so far: they’re not selling a product or an experience, but expertise. And expertise can be hard to convey—especially in this increasingly crowded era of so-called “thought leadership.”  

That’s where authority positioning comes in. Where thought leaders hold forth, authorities take a stand—they know. Thoughts are merely part of conversations. Authority directs them, makes them smarter, or, by raising unasked questions, starts entirely new ones. Thoughts are heard, authorities are heeded.  

We help our clients establish positions of authority in numerous ways. Our media relations team connects subject-matter experts with journalists to help them with their stories (and get ‘earned’ publicity when they’re quoted). Our content team crafts newsy, not salesy, content that provides relevant insights to target audiences in dynamic, readable, and narratively engaging ways. Our research team tracks what competitors are saying and finds out what audiences want to hear—all with the aim of finding white space for our clients to meaningfully direct important conversations.  

The four attributes of good authority positioning 

Our North Star is utility, which attracts C-suite executives to content more than any other attribute, according to Greentarget’s more than a decade of proprietary research. Utility disrupts the professional services sales cycle by answering the question “How do I navigate or address this issue today?” Ideally, it provides the answer before the audience has asked it. It empowers audiences to act.  

Case Study: Helping a Third-Party Fund Administrator Establish Authority in the ESG Environment 

JTC is a publicly listed professional services firm focused on fund and corporate administration, as well as private wealth services. A leading fund administrator with expertise in ESG-related funds like those established for Opportunity Zones, the firm now leverages its existing capabilities to provide ESG services like reporting, measurement, data collection, and training.  

Getting JTC’s foot in the ESG door, however, would be no simple task given the influx of competition to the space. In collaboration with Greentarget, the firm undertook a significant initiative to plant its flag: an annual research report about impact and ESG investing.  

This, too, was a crowded arena. So before the survey questions were even drafted, Greentarget conducted competitive analyses and messaging sessions to articulate JTC’s unique value proposition: namely, the firm’s innovative shared ownership model, understanding of both investors and fund managers, and strong track record of measuring the tangible impact (rather than merely ESG inputs or outputs) of that investing strategy.  

That last insight became a fundamental tenet of the report. As ESG ratings, frameworks and standards proliferate, so too will demands for reporting on specific, tangible outcomes to measure results and push back against accusations of “greenwashing.”  

The report, developed by Greentarget’s research team and written by our content and editorial team, provided the foundation for a widespread media relations and content campaign that raised JTC’s profile in this crowded space. Nine articles in publications ranging from Financial Planning to Regulatory Compliance Watch highlighted the report’s findings and JTC’s expertise—leading to nearly 800,000 total impressions and over $160,000 in projected advertising value. Several blog posts and event appearances were also spun out from the report, as well as two bylined articles by JTC executives, in Corporate Board Member and Chief Executive, which articulated what investors really thought about ESG.  

ESG Communications: Best Practices 

The above is just one example of how firms looking to cement their positions as ESG advisors can establish authority in today’s increasingly saturated marketplace. As the industry continues to develop, other communications needs will also rise to the fore—attracting and retaining talent, navigating conflict of interest issues, or combatting anti-ESG backlash.  

ESG-focused firms will face added pressure given the work they do. A few best practices they should consider as they move forward include:  

  • Focus on storytelling. Data points are crucial, but they aren’t enough, especially in today’s polarized climate. The best corporate ESG communicators, from Microsoft to Ben & Jerry’s, tell stories about the communities they help, the impacts they make, and how they do business. These stories illustrate not just the what but the how—a differentiator we helped a BigLaw firm communicate in their own ESG messaging. Stories and practical explanations of the ‘how’ engender emotional responses that help organizations stand out from the pack.   
  • Utility is key. In an increasingly crowded, politically charged, and fast-evolving space, offering insights that deliver utility to target audiences is vital. That may be as simple as providing clear updates on a new or impending regulation—there are already hundreds of ESG reporting standards globally—or clarifying the pros and cons of various measurement approaches. You may be surprised at what some people don’t know, as JTC discovered in their research showing that most U.S. fund managers and impact investors believe impact investing and ESG investing are the same thing.  
  • Prioritize clarity. Don’t add to your audiences’ confusion with jargon-filled insights, wordy web copy, or obtuse mission statements. Use clear language, specific details, and reliable formats (e.g., Axios style newsletters or FAQs) to illustrate who you are and what you can do.  
  • Conduct your own research. One way to differentiate yourself is by showcasing data that only you have, and that reveals your ESG expertise. The key is to make sure you’re not just adding to the noise. That’s where a narrower approach, perhaps homing in on a certain audience segment or emerging issue, can help.  

The ESG consultancy boom is still in early innings. As the space continues to evolve, only those who can establish themselves as true authorities will stand out from the crowd.  

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We hear it all the time: the next generation of talent—and leadership—wants more. More balance in their careers. More alignment with their values. More engagement with social issues.

The world of professional services firms—buttoned-up places that have traditionally skewed white, male and older, especially in leadership ranks—is particularly vulnerable to emerging stakeholders’ preferences. In a recent poll, less than 40% of Gen Z lawyers said they would like to join one of the U.S.’s largest 200 firms, down from nearly 60% just three years prior. Meanwhile, recent news out of law firm Barber Ranen involving the name partners’ racist, sexist, homophobic, and antisemitic emails (and those partners’ subsequent exit from the firm) is just one more indication that times are changing. Behavior that might once have been papered over now (rightly) carries significant consequences.

The question, then, isn’t whether these generational shifts are here or will have an impact. That’s a fait accompli. Rather, today’s business leaders should be asking how they can best communicate with their younger workers and clients to mitigate risks and set themselves up for success for years to come. Here’s how.  

Get to Know This New Audience

You can look up all the statistics you want: that younger employees care more about corporate culture; that almost 90% of millennial lawyers want flexibility and work-from-home options; that roughly half of accounting and finance students and young professionals cite personal well-being and mental health as a concern and think a great work-life balance is a key attraction factor for employment.

But while that’s a good start, it takes more to operationalize efforts at your own firm. Start by asking some key questions to help hone in: 

  • Who is our audience, internally and externally?
  • How quickly are their expectations evolving?
  • What messages do they need to hear and who should they hear them from?
  • How can we support our messages with tangible actions? 

 Social media listening, focus groups, surveys, and routine conversations with teammates and clients are extremely helpful tools for answering these questions.

For instance, one major law firm we work with held a series of focus groups last year to create messaging that would help attract and retain attorneys in a post-COVID landscape. The resulting messages—highlighting alternative career paths, the firm’s supportive culture, its initiatives around diversity, equity and inclusion, and a robust benefits program—were in large part aimed at this next generation of lawyers. They also helped with the continued evolution of their sponsoring and mentoring initiatives and talent outreach.

You can do the same with clients: Voice of the Client research can help build a multi-faceted understanding of your client’s needs, expectations and pain points—and can update your approach to the coming generation.

Establish and Live Up To Your Firm’s Values 

What does your professional services firm stand for? Why do you do what you do? And what impact do you make in the community, the nation, and the world?

These questions may sound lofty or even squishy to hard-charging business leaders. But these are the elements that millennials and Gen Z care most about. And MIT research shows that even if companies have a set of values written down, far too few are translating them into action in any tangible way.

The good news is since many organizations don’t meaningfully connect their actions to their values, you have an opportunity to set your firm apart in the minds of emerging stakeholders. To do so, you’ll need to look at your existing mission, governing principles, and values and honestly assess how well you’re living up to them. 

For example, if your values state that you’re committed to creating an internal culture that’s welcoming and inclusive, evaluate what building blocks you’ve put in place to make that value a reality. Have you taken steps to attract and retain a more diverse workforce? Are you actively combating harassment at your firm? Are you elevating diverse voices and ensuring people from underrepresented groups have a seat at leadership tables?

You’ll also need to be able to read the room and pivot when necessary. One professional services firm we work with did just that – after a series of acquisitions, the firm realized it needed to step up its executive communications game, particularly when it came to reaching newer, younger and prospective employees. A content campaign of internal emails and byline articles from one of the firm’s leaders brought the organization’s values to life in a personal, authentic way—and aimed to infuse the firm’s work with purpose, meaning, technological innovation, and fun.

Embrace an Authentic, Transparent Approach to Communication

Finally, you’ll need to evolve your firm’s communication style to earn the trust of a younger audience. Follow these best practices as you get started:

  • Carefully consider who to appoint as your firm’s spokesperson in each PR situation. Your CEO or managing partner may not always be the ideal choice, even when you’re countering negative press. A community leader, boots-on-the-ground manager, or third-party expert might be better suited to make your case and establish (or reestablish) trust.
  • Be strategic about the channels you use when communicating with younger audiences. Social media channels—especially YouTube and TikTok—are more effective at reaching Millennials and Gen Z than traditional media outlets. When you do communicate using these channels, be sure to keep a close eye on your audience’s comments and reactions. Staying engaged even in the face of criticism or intense questioning is key to demonstrating trustworthiness.
  • Avoid jargon and corporate speak. Use clear, straightforward language that paints a compelling picture. Don’t be afraid to pull back the curtain on your decision making process or draw on personal experiences. Younger audiences in particular roll their eyes at any hint of obfuscation.
  • Back up your words with action. Authenticity doesn’t just come from words—it comes from meaningful and concrete actions that support those words, whether it’s new hybrid working policies, benefits programs, mentorship opportunities, or DEI initiatives.

The Future is Now for Better Communications and Better Business

It’s imperative that professional services firms recognize the capabilities of Gen Zers and millennials, and work towards meeting their needs as soon as possible. That makes sense from more than a recruitment standpoint. Soon, those generations will also be in need of your services—but only if you take the time to establish trust now.

Taking steps to develop and adhere to strong corporate values, operate transparently and ethically, and understand stakeholder sentiments just make good sense, for your operations today as well as for the future of your business.

Greentarget knows how to develop PR strategies that speak the language of every generation. As a full-service communications firm, we’d love to help you position your firm for success now and down the road. Let’s talk.

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As your professional services firm continues to navigate today’s uncertain economy, it may become necessary to adjust staffing levels and/or cut expenses in other ways. And though these actions are intended to position your firm for long-term success, they can weaken your business if not done thoughtfully and with empathy for your audience.

Take MillerKnoll CEO Andi Owen as a cautionary tale. In April, she urged employees to “leave pity city” in response to complaints that they would not receive bonuses. In her video message, Owen starts off by encouraging employees to “focus on the things we can control.” But as she continues, her thinly veiled frustration starts to seep through. And before long, she raises her voice, wags her finger, and sarcastically scolds her team, saying:

Don’t ask about ‘What are we going to do if we don’t get a bonus?’ Get the damn 26 million dollars! Spend your time and your effort thinking about the $26 million we need and not thinking about what you’re going to do if you don’t get a bonus. Alright? Can I get some commitment for that? I’d appreciate that. I had an old boss who said to me one time, ‘You can visit pity city, but you can’t live there.’ So people? Leave pity city; let’s get it done. Thank you. Have a great day. 

She ends the video by making hand motions depicting an explosion, as if she’s just delivered a mind-blowing, enlightening truth bomb. But the biggest hit she delivered was to her own reputation.

Here’s the actual truth bomb: Empathy for your audience is fundamental to effective communication. And as a leader, you can’t afford to alienate your audience by delivering hard truths the wrong way.

The Business Impact of Empathetic Communication 

It’s never easy to share difficult news about things like staff reductions, bonus/salary freezes, and budget cuts. However, communicating challenging circumstances skillfully is an excellent way to establish your firm’s authority and build trust with your audience.

A communication plan rooted in empathy can:

  • Protect your firm’s reputation with internal stakeholders and the public 
  • Limit the amount of time bad news spends in the news cycle
  • Reassure stakeholders that you know what it takes for your firm to weather the storm and come out on top
  • Reinforce your brand and underscore your organizational values

Even if your firm is in good financial shape at the moment, you’ll most likely need to communicate difficult news at some point. It’s just part of running a business. And since the best way to manage a PR crisis is to avoid creating one in the first place, it’s wise to start working on your playbook now. 

5 Elements of a “Hard Times” Communications Playbook

Your firm’s financial health must guide your decision-making. But your stakeholders’ needs and expectations should be the compass that directs your communication plan. Incorporating the following five elements into your comms strategy will help you make the best of otherwise undesirable situations.

1. Exhibit Compassion

Every decision you make about your business impacts your people in some way. So when you’re communicating news about layoffs, salary freezes/reductions, and other cost-cutting measures, don’t underestimate the human toll the news will take.

Your employees may ask you difficult questions, put you on the spot, and criticize your leadership in response to hard news. Treat them with dignity anyway. You can’t walk in their shoes, but you can remain empathetic and expressgenuine concern for their welfare. 

2. Time the Announcement Carefully

You should always share bad news with employees who are directly impacted before you announce it to everyone else. However, you should also know who your secondary and tertiary audiences are and be ready to cascade your messages to them quickly.

Bear in mind, anything you say internally has the potential to be shared externally. So don’t begin communicating with employees until you’ve put together a plan for responding to questions and concerns from public stakeholders and the media.

3. Use the Right Channels to Communicate to Each Audience

It’s also important to think about how you will communicate difficult messages. Should you send an email? Schedule a video conference? Hold a town hall meeting? Personally speak to employees in small groups or one-on-one? 

There’s not necessarily a right or wrong answer here. But in general, you should do what feels most authentic to your firm’s culture and you shouldn’t simply take the easy way out. 

Firing 900 employees over Zoom won’t win you any goodwill. Again, keep empathy at the forefront when choosing how you’ll deliver the news. 

4. Be Blunt, But Kind

This might seem like counterintuitive advice. But when it comes to delivering hard truths, it’s ok to be blunt as long as the message is anchored in genuine kindness. 

In fact, it’s often better to deliver the truth in a straightforward manner rather than try to soften bad news or minimize its impact. After all, economic uncertainty causes nearly everyone to feel higher levels of fear and paranoia. So sometimes the kindest thing you can do is remove all uncertainty from the equation. 

Don’t beat around the bush or use vague, confusing language. Instead, be transparent and direct. Let your employees know exactly what’s happening and why. Share the business case for the decisions you’re making. And give as many details as you can about what will happen next. 

5. Reassure Your Stakeholders That the Future is Bright

Finally, provide your team with a clear idea of where your firm is headed so you can rally them around a shared set of goals and objectives. This is an opportunity to sharpen your value proposition, streamline operations, and align your people for the path forward.

Your stakeholders need to know that you’re making decisions based on what’s best for the company and, ultimately, what’s best for them, too. To that end, don’t share bad news without also painting a picture of a bright future you can all believe in and work toward.

Communicate Effectively to Guide Your Firm Through Challenging Times

In decades past, CEOs and other executive leaders may have had more freedom to communicate bad news in a top-down, authoritarian way. The rules were different, and previous generations of stakeholders and employees were more willing to accept a “this is the way it is” approach to communication.

Whether you accept it or not, that style simply doesn’t cut it anymore. And if you slip into old-school patterns of communication, you can be sure it will come back to haunt you. 

Leading your firm through choppy waters starts by winning the trust of your people. And that, of course, begins with communicating effectively in good times and in bad. So if you need help evolving your executive communications playbook? Let’s talk.

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If the prospect of a publicly traded U.S. law firm seems unlikely, consider that more than five decades ago, there was no such thing as a publicly traded American investment bank. Due to a nearly 200-year-old rule requiring that the New York Stock Exchange approve all shareholders of its member firms, the NYSE didn’t allow them. But thanks to Dan Lufkin, who engineered the 1970 initial public offering of his investment banking and brokerage firm, Donaldson, Lufkin & Jenrette, the NYSE amended its rules and it’s now difficult to imagine the big Wall Street firms like Goldman or Morgan Stanley as private partnerships. But they were. Just like today’s big law firms.  

According to William Cohan, who relays this story in his article, The Next Big I.P.O. Scramble, it may be only a matter of time before a bold and enterprising law firm follows in Lufkin’s radical footsteps and converts its private partnership into a public corporation – a structure that would provide greater access to capital, help streamline law-firm mergers and allow retiring partners to cash out their shares. Like the NYSE once prevented investment bank listings, most state bar associations still have rules against non-lawyer ownership of law firms. But that has begun to change. 

Utah and Arizona have relaxed the American Bar Association rule barring nonlawyers from sharing in law firm ownership. To a fiercely competitive industry that has few options for raising capital, these changes could open a door to a source of affordable growth capital, a liquid market for partners’ equity, and a reliable method for determining a firm’s relative value in a highly acquisitive marketplace. The two states have granted a total of 91 licenses for alternative legal business entities, according to The American Lawyer. Once a major law firm walks through that door, many more could follow. 

Skeptical? If the true story of the investment banking industry’s conversion isn’t a sufficient analog, the rapidly growing appetite for litigation finance, even among the legal industry’s biggest firms, is further evidence that law firms are eager to tap alternative sources of capital to fund their growth.

So if this potential shift becomes reality, law firms that take the IPO plunge will need to communicate frequently with an entirely new audience — public shareholders. And meeting shareholders’ demand for information will require significant, fundamental changes to how law firms share information with stakeholders.

What does this mean for you? Effective shareholder communication is not a switch you can flip on the first day of trading. If you harbor hope that your law firm will someday ring that iconic opening bell, plan to implement the following five tactics well before you file your registration statement. Doing so will support a successful IPO and enhance your ability to communicate effectively with your shareholders going forward, supporting quarterly earnings and other material disclosures, and ultimately an appropriate valuation. 

1. Generate Pre-Filing Awareness

When contemplating a public offering, the way your firm communicates right now matters. Once you file your S-1, or registration statement, you can’t be perceived as promoting the offering as you prepare to begin trading. But you are permitted to continue sharing certain information about your business as you have in the past.  

To establish an appropriate baseline, your external communication plan should include:

  • Announcements of your involvement in major matters, litigation wins, and other noteworthy milestones
  • Timely content conveying unique positions of authority from your firm’s partners and subject matter experts
  • Media interviews that result in your partners’ appearance in the press, sharing points-of-view on issues that matter to clients 
  • Information about your firm’s social impact, e.g. pro bono and DEI initiatives 

Chances are you’re already doing many of these things as part of your owned and earned media efforts. And of course, all of these activities are valuable and worthwhile even if the opportunity or desire to take your firm public never arises. But to set your firm up to communicate more freely throughout the process of going public, begin covering all these bases by ramping up your external comms strategies now. 

2. Establish Metrics for Your Business

Partnerships are evaluated differently than publicly traded firms. The American Lawyer ranks its A-List firms based on these measurements: revenue per lawyer, associate satisfaction, diversity, pro bono initiatives, and the percentage of female equity partners. Firms rank on the AmLaw 100 according to self-disclosed or estimated figures like gross revenue, profits per partner, and revenue per lawyer. This will not satisfy Wall Street.

Law firms weighing IPOs should consider a mix of metrics that your shareholders demand – which would be similar to those disclosed by most listed companies (revenue, income, and earnings per share) – and those that you want your shareholders to track as well, such as realization rate, total billable hours and utilization rates, and client acquisition and attrition rates.  

Regardless of which metrics you choose, you need to identify them before your offering, educate investors about their value and importance during the offering roadshow, and set up systems that allow you to track those metrics on a weekly basis. Weekly? Yes. Most newly public companies trade below their offering prices within six to nine months of the IPO, often because management lacks visibility into their own metrics. This can result in quarterly financial results falling short of expectations and surprising shareholders. And surprised shareholders sell stock.   

Establishing the right metrics now — and tracking them weekly — is the best way to guard against a future market flop.

3. Identify Appropriate Comps

Investment bankers always look at comparable companies when valuing an IPO. And naturally, analysts and brokers will want research on other publicly traded firms like yours in order to better understand your performance and persuade their investors to bet on you. But until several law firms go public, it will be difficult for them to find the comps they’re looking for.

This is another area where being proactive matters. Look for publicly traded firms in industries with similar models, like consulting, to give analysts and investors the comps they’ll need to evaluate your business.

4. Adopt IPO Disclosure Policies and Procedures

As a law firm, you’ll likely have a leg up in understanding the regulatory landscape that listed companies must navigate, particularly regarding the disclosure of material information. But it’s still worth mentioning that once you’ve filed to go public, leadership and other members of the firm can no longer engage in casual conversations about financial performance and news that might impact your valuation. 

According to SEC guidelines, anything your firm discloses to one person must be disclosed to everyone. And if you share material non-public information — even if it’s done unintentionally — you could be accused of enabling insider trading.

5. Ramp Up Internal Communications 

When the time comes, it will also be essential to communicate openly with employees about your IPO and protect your firm from confidentiality breaches and legal liability. 

Employees would need to understand: 

  • The rationale and business case for the IPO
  • How the shift from a partnership model to a publicly traded model will impact them
  • Specific guidelines regarding what they can and cannot say to outsiders about their work
  • Guidance on how they should answer questions they’re asked about your IPO
  • Examples of common confidentiality breaches (like sharing information with a spouse, friend or a colleague from another firm) 

Keep in mind that going public would represent a significant organizational change. To win employee buy-in and support, you must be proactive about managing the change internally. 

Going Public Requires a New Approach to Law Firm Communication 

Embarking on an IPO could be an incredibly exciting, all-eyes-on-your-firm moment. To leverage the opportunity a public offering could present, you must start planning early. 

But it’s not enough to launch successfully. You’d also have to sustain (and build on) your success quarter after quarter and year after year. And all the while, you need to communicate with a level of openness and transparency that might feel totally foreign. 

You don’t have to make this leap alone. The Greentarget team has experience helping clients navigate the IPO landscape, and we speak the unique language of partnership-based law firms. So if your firm explores going public, we’d love to walk with you every step of the way.

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Prior to his arrest, Sam Bankman-Fried’s attempts to explain the collapse at FTX did little to reassure or assuage his audience and stakeholders. Nor did they inspire confidence in the company’s ability to rebound from its downfall. Rather, by over-explaining his position, SBF seemed intent on proving that FTX lacks (and apparently has always lacked) any sense of organization, discipline, or accountability.

Allegations of fraud aside, among Bankman-Fried’s mistakes is his insistence on behaving like a classic tragic figure. Like Shakespeare’s King Lear or Arthur Miller’s Willy Loman, Bankman-Fried appears to be unaware of how the world sees him. Yet he can’t seem to stop trying to convince everyone that his own flawed vision of himself is just and true.

What SBF needs (or, rather, needed) is a fool, just like the fool in King Lear’s court — a brave and discerning advisor who’s close to the center of power, able and willing to speak the truth that no one else can. If you’re a PR or communications leader, you’re uniquely suited to meet this need at your organization.

What Executives Can Learn from a Fool

In King Lear, the Fool is not merely a court jester. Sure, the Fool cracks jokes at the expense of the king. But the fool is there to do more than entertain. This character sees through the artifice of the king’s self-delusion and uses irony and wit to force King Lear to look in the mirror and face the consequences of his behavior. 

The Fool is loyal to his ruler, for sure. He has the king’s best interests at heart and knows his strengths and weaknesses better than anyone. The Fool uses his position within Lear’s inner circle to try to protect the king, continually warning him of the folly of his poor decisions.

Where’s the Fool at FTX? 

In an interview with Andrew Ross Sorkin, Bankman-Fried said there was no one at FTX who challenged him. If his account is to be believed, not a single person advised him of the missteps his company was taking. No one was responsible for monitoring risk or alerting higher-ups that what they were doing was dangerous or wrong. (Of course, perhaps someone did try to speak out and SBF was simply unwilling to listen. Lear ignored his Fool, too — and it led to his undoing.)

The result? FTX is bankrupt. Bankman-Fried has resigned as CEO. He lost his personal fortune and the fortunes of others. Many of those who previously lauded SBF’s ingenuity have disappeared. And SBF has pled not guilty to allegations of fraud, conspiracy, and money laundering — underscoring his commitment to proving that his vision of himself is true.

It’s impossible to know if things would have turned out differently for FTX had someone seized the Fool’s mantle. But the lesson here is that every king (or CEO) needs someone who’s willing to play the wise Fool, especially in the face of a PR maelstrom. 

Here’s why PR leaders are uniquely suited to play this critical role. 

You Know How to Shape Messages Your Audience Will Accept

Of all the executives in the CEO’s sphere of influence, PR and communications leaders are closest to the organization’s audience. On good days, you’re the person who’s carefully crafting messages that resonate with the public and advance your organization’s strategic goals. On bad days, you know which messages stand a chance of breaking through the noise to reach and reassure your stakeholders. Therefore, you know what your audience will accept as credible, and what it will find disingenuous. 

As much as they may want to, CEOs can’t kill a negative PR story or otherwise spin their way out of a crisis. They also shouldn’t blindly take legal counsel’s advice to stay silent (although, in SBF’s case, silence would likely have been the better strategy). 

It’s your job to help your CEO communicate responsibly in the midst of any PR challenges your company may face. If you don’t believe what the CEO is saying, you know your audience won’t either. And because it’s your responsibility to protect your firm’s reputation, you have an obligation to rethink any messages that ring hollow or — worse — untrue. It’s not about doing the right thing from a moral perspective (though it is…), it’s about doing what’s best for the company’s reputation.

To play the Fool effectively, you’ll need to:

You Understand How the Firm Should (and Should Not) Respond to a PR Crisis

Following the FTX collapse, the only information Bankman-Fried offered led many reasonable people to draw one of two conclusions: either he’s a criminal or he’s profoundly incompetent. Whichever conclusion you drew, he certainly did little to repair his image, or restore the reputation of his company, or at least slow the erosion of either. 

True, he apologized. But a shallow demonstration of contrition without meaningful insight into what went wrong or what he’d do differently next time doesn’t mean a whole lot to people who’ve lost everything. Bankman-Fried provides an excellent example of how CEOs should not respond to a PR crisis. 

During a crisis, PR counselors remind their CEOs that:

  • Now’s the time to set ego aside
  • Bad stories are probably inevitable, but good PR can make bad stories less bad
  • Statements framed in default corporate-speak alienate the audience further — now is the time for authenticity and vulnerability 
  • Crises are an opportunity to fix what is broken within the organization
  • It’s ok to punch back (purposefully) against false claims, misinformation or carelessness 

PR firms have spent decades creating effective crisis communications playbooks for a reason. Your CEO might want to break with convention to share her or his desired message. But there should always be a thoughtful strategy behind the approach your organization takes.

Play the PR Fool to Direct a Smarter Conversation at Your Firm

The downfall of FTX — and SBF’s subsequent media tour  — provide an extreme example of a badly handled crisis. And though the whole situation is a train wreck you can’t help but watch, there are valuable lessons here for CEOs as well as PR professionals.

CEOs must create space for trusted advisors to tell them the truth — even the hard truths they don’t particularly want to hear. And PR/communications leaders must be willing to play the Fool — especially when, like King Lear, their CEO seems bent on folly of another sort  (whether they’re aware of it or not). 

Greentarget can help you put a PR plan in place that upholds and protects your firm’s reputation. There’s no need to speak truth to power on your own since we’re here to help.

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