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Looking Your Best on TV 147

Conclusions 148

Endnotes 148

6 Gaining Complete Control Over the Media: Advocacy

Advertising

151

Use of Advocacy Ads Grows 152

Broadcast Networks Restrict Advocacy Advertising 154

Print Media More Hospitable Toward Advocacy Ads 155

Objectives of Advocacy Advertising 156

Correct Media Errors and Distortion 156

Garner Public Attention and Support 157

Stimulate News Coverage 158

Influence Government Action 159

How Effective Are Advocacy Ads? 160

Determine the Criteria for Effectiveness 162

Conditions That Enhance Effectiveness 164

Trends in Corporate Advertising 165

Corporate Branding 166

Conclusions 167

Endnotes 167

7 Holding the Media Accountable and Suing 171

Using Media Monitoring and Oversight Groups 173

Media Watchdogs 174

News Councils 175

Launch a Media Blitz Against Media Misrepresentation 177

Acquire Media Ownership and Board Membership 178

Concentration of Ownership 179

Board Membership 182

Engage in Public Journalism 183

Suing the Media 185

1996 Becomes a Peak Libel Suit Year 185

Cases of Deceptive or Careless Newsgathering 185

Effects of Libel Suits: The Media Become More Careful,

and Some Are Intimidated 190

Conclusions 192

Appendix 192

Endnotes 194

x I CONTENTS

8 Bypassing the News Media: Direct Communication 199

Disenchantment With the News Media 200

Polls Reveal Public Doubts About the Media 200

Liberal Bias 202

Intrusion of Commercial Values 204

Methods of Alternative and Direct Communication 208

Use of Alternative Media by Politicians 208

Private Communication Systems 209

Database Marketing 210

The Internet 212

Conclusions 217

Endnotes 217

IV: Governmental Strategies

9 Direct Lobbying 229

The Lobbying Business 230

Who Hires Lobbyists? 230

Who Are the Lobbyists? 231

Direct Lobbying Resources and Skills 237

Access 237

Information and Knowledge 240

A Mutually Beneficial Relationship 243

Some Helpful Skills 243

Working with Congressional Committees 244

Testifying Before a Congressional Committee 244

Arranging for Media Coverage at Hearings 246

Other Advice for Effective Government Presentations 246

Conclusions 247

Endnotes 247

10 Grassroots Lobbying 250

Why Grassroots Activities Have Become Important 251

Changes in Political Structure 252

Effective Technology 252

Elements of Grassroots Lobbying 253

Constituency Building 254

Constituency Communication 258

CONTENTS I xi

Constituency Activation and Methods of Pressuring

Lawmakers 259

Tools of Grassroots Lobbying 261

Telephones Are Still Useful 262

Computer Technology Enhances Grassroots

Effectiveness 265

Organizing an Integrated Lobbying Campaign: How CSE

Does It 268

Conclusions 269

Endnotes 269

11 Electoral Activities 273

Political Campaign Contributions 274

Sources of Campaign Financing 274

Specific Sources of Financing 275

Campaign Finance Laws 281

Issue Advocacy Advertising 283

Ads Financing by 527s and Other Nonprofit Groups 284

Effectiveness of Campaign Ads 288

How Effective Are Political Contributions? 289

Helping a Candidate Win 289

Supporting Lobbying Efforts 290

Helpful Conditions 292

Other Political Assistance and Cyberpolitics 293

Merging Political Assistance With Public Affairs 293

Getting Out the Vote Programs 295

Voter Education Programs 295

Whether to Engage in Partisan Communications 297

Cyberpolitics 297

Conclusions 298

Appendix 299

Endnotes 301

12 Litigation Communication 310

Judgeships Are Often Elective Offices 311

Power of the Judicial Branch of Government 312

Growth of Litigation Public Relations 313

Total War Against Corporations 314

Corporate Scandals Increase Vulnerability 315

xii I CONTENTS

Litigation Public Relations Gains Recognition 316

Product Liability 320

Growth in Product Liability Cases 320

Cost of Litigation 321

Tort Reform 324

Some Principles and Techniques of Litigation Public

Relations 328

Other Corporation Strategies 333

Junk Science Campaign 333

Suppression of Public Information 335

Seeking Sanctions Against Opponents 338

Conclusions 338

Endnotes 339

V: Dominance Versus Competition

13 Ascendancy of Corporate Power 347

Corporate Gains in Political Power: The Big Picture 348

Scandals Reveal Extent of Corporate Dominance 349

Four Dangers of Corporate Dominance Exposed by

Scandals 349

Impact of Scandals 351

Growing Corporate Influence Over Government 354

More Deregulation and Lax Antitrust Laws 354

Creeping Privatization—Including the Military 355

Power of Interest Groups Fluctuates But Endures 357

Environmental Groups 358

Labor Union Power Eroding But Still to Be Reckoned

With 362

Growing Corporate Media Power 366

Dangers of Media Concentration 366

Telecommunications Act of 1996 368

Media Concentration Grows 369

Conclusions 374

Endnotes 375

14 Constructing a Competitive Political Marketplace 381

Maintain Competition in the Political Marketplace 382

Encourage Diversity of Interest Groups 383

CONTENTS I xiii

Recognize the Legitimate Function of Government 384

Avoid Gross Disparities in Political “Purchasing

Power” 386

Transparency: Repair the Financial Information

Infrastructure 387

Scandals Expose Fractures in the Financial Information

Infrastructure 388

The Sarbanes-Oxley Act Seeks to Repair the Information

Infrastructure 393

The Culture of Wall Street Changes Slowly 395

Corporate Leaders 395

Wall Street 397

Conclusions 399

Endnotes 399

15 Heeding the Public Interest 404

Embracing Corporate Social Responsibility 406

Climbing the Pyramid of CSR 407

Growing Support for CSR and Ethics Programs 413

Engaging in Stakeholder Relationships 413

Subscribing to the Managerial Creed 414

Identifying Stakeholders 416

A Relationship Model 417

Incorporating the Public Interest in Corporate

Governance 419

Form a Public Interest Committee 420

Expand Composition of Board Membership 422

Conduct Social Audit and Publish Social Report 424

Upholding a Corporation’s Reputation: The CEO’s Role 425

Conclusions 428

Endnotes 429

Author Index 435

Subject Index 445

xiv I CONTENTS

Preface

A corporation’s sociopolitical environment can affect its profitability,

growth, and, in extreme cases, its very survival. Not surprisingly, corp-

orations have established a public affairs function—often an extension

of existing public relations—to deal with that environment. In recogni-

tion of this function, business schools have added courses to their busi-

ness and society curriculum. The professionals who specialize in dealing

with the external environment are called corporation public affairs vice-

presidents and directors.

Public affairs professionals are given responsibility for many activi-

ties, such as government relations, direct and grassroots lobbying, is-

sues management, and media relations. All of these activities, discussed

in the book, focus on the generation and application of political power.

In a sense, the professional’s task is to convert a corporation’s economic

resources into various forms of political power.

Practically everybody wants to deal with others advantageously in

our dynamic society, where success depends not only on marketplace

strength but also political shrewdness. The powerful flourish; the weak

wither. Within organizations, all managers are aware of power: who

has authority over others and who has access to needed resources. The

same is true externally, where an organization may be confronted by la

bor unions, environmental and other social action groups, the media

(including the pervasive Internet), and all three branches of govern

ment: executive, legislative, and judicial.

Strategies and their supporting tactics, however, cannot effectively be

applied unless professionals understand their underlying theory and

dynamics. Each chapter is therefore interlaced with management and

communication concepts—some from professionals and some from ac

ademicians. Such knowledge helps prevent the blind application of cam

paigns that worked elsewhere but might not be appropriate for a

current situation. In part, therefore, this book serves as a manual of cor

porate public affairs strategies and tactics

Readers can view each part of the book from several angles: as dynamic

forces in a corporation’s sociopolitical environment, as stages in a public

affairs campaign, and as major modes of communication: opinion leader

communication, public communication, legislative communication, and

litigation communication. Following the life cycle concept of issues man

agement (discussed in chap. 1), a professional can decide which stage is

appropriate for a particular situation (e.g., an emerging issue or one al

ready on the legislative agenda). The strategies and techniques associated

with a particular stage can then be examined and applied.

The book frequently refers to the model of a political marketplace:

the stage on which the players interact. The demand side is represented

by corporations and interest groups, as well as the public; that is, citi-

zens with their “voting power”—a parallel to consumers’ “purchasing

power.” The supply side is represented by legislative and regulatory

bodies that “sell” public policies and a variety of favors, such as tax ben-

efits, subsidies, and tariff protection to the buyers. Using the metaphor

of the political marketplace has several advantages. One is a reminder to

management that success in this marketplace is often of equal impor-

tance to success in the marketplace for goods and services. As corpora-

tions, following their markets, become more global, they also subject

themselves to the laws and agreements of other governments and inter-

national bodies.

A second advantage of the political marketplace metaphor is that it

reminds us of the need to be competitive and to use marketing tools

while considering the long-term requirement of maintaining a competi-

tive system. Profit maximization guides business behavior in the com-

petitive marketplace; similarly, the quest to attain preeminent power is

the motivation behind a corporation’s dealings with others. However,

just as some corporations temper profit maximization with concerns of

social responsibility, their penchant to win in the political marketplace

shows concern for continuing corporate legitimacy and survival of the

free enterprise system. Public affairs professionals must take responsi

bility for this concern, or they will unwittingly erode corporate reputa

tion and jeopardize public confidence in business.

Part I of the book, consisting of chapter 1, provides an overview of the

corporate public affairs function. Of special importance is a review of

activities engaged in by public affairs professionals and an inventory of

available political resources. The chapter also summarizes the tool of is

sues management and one of its key concepts, the life cycle of an issue,

which involves four stages: when an issue first emerges, when the pub

lic becomes involved, when lawmakers and regulators ponder and initi

ate legislation, and when lawyers and judges adjudicate disputes.

Subsequent parts of the book are organized according to these stages:

interest group strategies, media strategies, legislative strategies, and lit

igation strategies.

xvi I PREFACE

Part II—on interest group strategies—deals with the myriad interest

groups in the United States, such as labor unions and environmental,

consumer, women’s, and human rights groups, that compose a powerful

force. They promote their agendas, make demands on corporations, and

insist on the inclusion of their interests in a firm’s profit-making calcula

tions. Confrontations between interest groups and corporations contrib

ute to media exposure and sometimes involve lawsuits that seek

compliance and punishment. Chapter 2 discusses such contrasting strat

egies as containment and engagement, as well as various “opinion leader

communication” techniques to deal with interest groups. Chapter 3

shows how environmental groups and others use the process of public

participation and the increasingly used strategies of conflict resolution to

reconcile their differences with others and to achieve mutual benefit.

Part III—on media strategies—recognizes the media’s increasing cov

erage of business events, especially negative ones, that have tremendous

power both to undermine corporate credibility and to support public

policy positions. Serving as society’s watchdog, they draw attention to

product flaws, management misconduct, environmental damage, and

other criticisms of business. Corporate reputations, so important in at-

tracting investors, recruiting workers, and selling products, can be tar-

nished and permanently ruined. The media also promote or criticize the

policies and views of all contending actors in the political marketplace:

government, corporations, and interest groups. Five chapters deal with

media strategies—the first three with gaining greater control over what

the media say, and the next two with desired long-term structural

changes in the media and how corporations communicate directly with

its stakeholders and the public.

Part IV—governmental strategies—deals with all three branches of

government: legislative, executive and judicial. Government is the

most powerful force in a corporation’s sociopolitical environment be

cause it holds ultimate power and resources. In terms of power, it can

restructure the marketplace, ban a product or demand a recall, impose

environmental and occupational health and safety requirements, and

restrict exportation. In terms of resources, government can grant li

censes and loan guarantees, provide subsidies, and help promote the

sale of products overseas. Three major ways of influencing lawmakers

and regulators—direct and grassroots lobbying as well as electoral ac

tivities—are presented in chapters 9, 10, and 11. Chapter 12, “Litiga

tion Communication,” extends governmental communication to the

judicial branch. Recognizing that ours is a litigious society, the chapter

examines efforts to influence judges and juries. The outcome of law

suits can undermine profits and seriously damage corporate reputa

tion and viability.

Part V—“Dominance Versus Competition”—raises the question of

how corporate power strategies have affected the political marketplace.

Chapter 13, “Ascendancy of Corporate Power,” assesses how well U.S.

corporations have achieved their public affairs goals and whether some

PREFACE I xvii

of the strategies and techniques used are harmful to themselves and so

ciety in the long run. Chapter 14 prescribes reforms required in corpo

rate policies and behavior, as well as in the role of government, to

achieve the norm of a competitive political system. Chapter 15 asserts

that corporations must heed the public interest by recognizing the dou

ble bottom line of profits and social responsibility. After reviewing five

levels of corporate social responsibility, the importance of engaging in

constructive stakeholder relationships and incorporating the public in

terest in corporate governance is discussed. It also recognizes another

scoreboard: corporate reputation, which is largely determined by the

CEO’s reputation. Using the marketplace metaphor, the book recom

mends that the healthiest state of affairs is continued competition

among all legitimate contenders of power.

ACKNOWLEDGMENTS

Many professionals, colleagues, alumni, and students have contributed

to this book. Kenneth Kansas, Frank LeBart, James Morakis, and Mary

Ann Pires have shared their knowledge with me and my Corporate Pub-

lic Affairs classes. Wes Pederson and his colleagues at the Public Affairs

Council have generously provided reports on the latest developments in

their field. Members of the Corporate Section and Public Affairs and

Government Section of the Public Relations Society of America have

contributed information about their programs and campaigns. Several

graduate assistants—Lauren Knebel, Lillian Oben, MinJung Sung, and

Sara Kemp—have helped with research and editorial improvements. I

thank my colleague, Joyce Marcario, who applied her graphic design

skills to the book’s figures. My wife, Beth, has endured my unavailabil-

ity for many events and served as my social conscience.

—Otto Lerbinger

xviii I PREFACE

Introduction

Part I sets the stage for exploring specific public affairs strategies for at-

taining power. A corporation’s external environment must be mapped

out in a manner that selects its most important aspects and simplifies

them. Just as accountants observe money transactions and engineers

and scientists concentrate on technological changes, public affairs pro-

fessionals focus on the public issues, trends, and public policies that can

affect a corporation. Like public relations people, they are mainly con-

cerned with an organization’s sociopolitical environment.

Public affairs professionals monitor the environment for issues and

trends that affect their organizations. In a process called issues manage-

ment, described in chapter 1, they then analyze issues and trends for the

purpose of participating in a corporation’s and society’s public policy

process. Once a corporation—or any other organization—formulates

its policy position, it plans and executes campaigns and programs to in-

fluence government and other participants. The main purpose of this

book is to help professionals choose the most effective influence strate

gies and techniques to accomplish those tasks within ethical limits and

with a consideration for maintaining existing relationships.

Figure I.1 lists the functions involved in this public affairs process to

gether with their interrelationships. The functions are arranged on

three occupational levels: executive, professional, and technical. The ex

ecutive level is where responsibility is lodged; the professional, where

knowledge resides; and the technical, where skills predominate. The

public affairs professional, centered in the middle professional level,

serves as a counselor to management and a public affairs manager of

the technical staff, in addition to exercising professional judgment on

the two functions. Two loops connect the sociopolitical environment

(shown on the bottom) with the corporation (shown on the top). The

upward loop (on the left) describes the preliminary steps of issues man