The third of a six-part series examining prominent corporate crises impacting U.S.-based business operations during 2011.
When seeking the latest dirt on a prominent celebrity embroiled in a slimy scandal, the first place interested readers turn is to the tabloid media. Suspend your belief system and toss your moral convictions out the window because reporters with little to no belief in journalistic ethics are providing the inside skinny. After all, it’s front page news!
We did it with Tiger Woods, we do with the Kardashians and we will read voraciously when the next time a politician wakes up next to a live boy or dead girl. The twist 2011 brought us is the tabloid news gathering practice became the centerpiece of the story.
What a salacious story it was. Within days of the Milly Dowler/News Corp. story breaking, journalism professors began educating us about how the lingering impact of News Corp.’s news gathering practices would have on the journalism profession, then segued into forecasting how social media aggregators will impact the future of journalism and finally lamented the apparent loss of journalistic ethics. News Corp.’s news gathering techniques gave crisis communication experts a platform to tell us how the company, and potentially the Murdoch family, might have mitigated the damage by acting more quickly and with greater humility. I agree that Rupert Murdoch needed to be far more humble but truth was the missing “T,” not timing.
If having one of England’s oldest daily newspapers embroiled in this crisis wasn’t sufficient, the slimy entrails of scandal snaked its way to 10 Downing Street when the former Communications Chief for Prime Minister David Cameron, was arrested for phone hacking and corruption charges that are alleged to have occurred while he was editor of NEWS OF THE WORLD from 2003 to 2007. Not content with simply dirtying up the country’s top elected official, this scandal stayed on the move by sullying the reputation of Scotland Yard and the nation’s top police official.
But this scandal wasn’t satisfied denigrating England’s shores, it jumped the Atlantic Ocean and landed in the New York City offices of Dow Jones & Company, the publisher of the WALL STREET JOURNAL and BARRON’s. Ultimately, the CEO of Dow Jones & Co. resigned for not taking appropriate action while an executive with News International. Meanwhile, the search for similar news gathering practices across Rupert Murdoch’s U.S. media empire commenced with calls for Congressional inquiries, a Security and Exchanges Commission (SEC) investigation as well as requests for the FBI to look into possible breaches of the Foreign Corrupt Practices Act (FCPA).
Poor Milly Dowler. The 13-year-old English girl was abducted on her way home from school in March 2002 and subsequently murdered. Little did her grieving parents and love ones realize during those horrid days of uncertainty and finality that nine years later the news media’s coverage of Milly’s disappearance and passing would spark a national controversy on reportorial techniques and a global business practices crisis.
GE Brings Occupy to Life
Investor relations and crisis communications pros went on high alert in late March 2011 after the news media reported GE filed its 2010 federal income tax report but paid zero in taxes on $5.1 billion in income from U.S. operations. To those most exorcised by this news, the zero dollars paid in taxes tested their patience while the $3.2 billion the company claimed as a tax benefit tested their gag reflex.
As the filing became more understood by the public, the frustrations of those Americans most impacted by the economic downturn of 2008 grew. One particular factoid was the communication that GE employs a small army of people, known sarcastically as the world’s best tax law firm, assembled with the specific objective of limiting the company’s tax impact. Comprised of former employees of the U.S. Treasury, IRS and Congressional tax-writing committees, this talented group knows the comprehensive existing tax code well enough to apply liberal interpretations in the company’s favor and possessed the budget to buy the time of DC’s best lobbyists when new business operations foresee a change in the federal regulations are needed.
GE weathered the immediate crisis stemming from the filing of its return but the national frustration continued to mount. Taking a page from the demonstrations in Tunisia, the Egyptian uprisings last February and later in Syria, Americans turned to social media. Desiring a medium to voice their objection to a system perceived to be rigged in favor of the ultra-wealthy, people nationwide and spanning all age groups used Twitter, spawning the the birth of the hashtag #occupywallstreet. After the OWS protesters grew to a couple thousand in New York City’s Zucotti Park on a daily basis, the Occupy movement spread like wildfire across the nation. But the movement’s popularity has grown around the world: from Hong Kong to London, from Miami to Fairbanks, from Berlin to Sydney.
Police actions nationwide have broken up the camps for the present. Questions remain unanswered whether spring 2012 will give birth a reemergence of the camps, if the protestors will elect to voice specific demands for change and what role the uprising will have on the 2012 general election, specifically the race for the White House.