News Corp.’s misguided response to the escalating phone-hacking scandal will undoubtedly become a case study for business schools and public relations professionals on the potential perils of not properly managing the reputations of all of a company’s assets. In trying to make excuses for unethical actions by some News of the World reporters and editors, Rupert Murdoch has demonstrated a profound lack of understanding of how his actions and words influence the public’s perception of his company and its employees.
Murdoch has failed to keep in mind the famous Arthur Page adage that reputation is 10 percent what you say and 90 percent what you do.
Beyond the negative impact this scandal is having on News Corp.’s stock-market value — not to mention raising investor ire and forcing the company to pull its bid for BSkyB — the reputational hit that News Corp. has taken is monumental. In unsuccessfully trying to save the careers of some of his top lieutenants, including former News International CEO Rebekah Brooks, Murdoch is damaging the reputation of all his media properties.
The fallout from this scandal also demonstrates that reputation management in the digital age has become an immense challenge for many businesses, even for News Corp., which has weathered many crises over the years.
Rupert Murdoch and News Corp. should follow the guidance of the public relations professionals — including those from PR firm Edelman — that are now providing crisis communications counsel. Chief among those recommendations should be a commitment to transparent and forthright communications regarding News Corp.’s hacking and whether any other improprieties have taken place within the company.
Related PRSA Statements and Commentary:
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