Oral Histories

Kurt Stocker

Interview Segments on Topic: Trust/Credibility

Kurt Stocker Biography

Kurt Stocker’s career has spanned all aspects of public relations, having held positions in the corporate, agency and academic worlds.  An associate professor at the Northwestern University Medill School of Journalism’s Integrated Marketing Communications Program, Stocker has been recognized for his expertise in crisis management, employee communications, corporate governance, Integrated Marketing Communications, reputation management and professional development. 

Stocker is a member of the New York Stock Exchange Regulation Board of Directors, Chair of the NYSE Individual Investor Advisory Board, member of the Disclosure Advisory Board and is a member of the Hall of Fame and past president of the Arthur W. Page Society.

Transcript

Interviewer: OK, you’ve worked extensively to restore credibility to corporate governance and the disclosure of information important to investors. Could you talk about the Disclosure Advisory Board, the New York Stock Exchange, and the increased responsibilities that are falling on public relations specialists? Is there movement in that level of trust for the public for those entities?

Stocker: Trust is as tough thing and the words around trust today—mostly coming out of governance—are transparency and disclosure. To begin with, transparency and disclosure will not create trust. Just being able to know something is happening or to open your jacket and say if you really want to know what’s coming or what’s happening come and look, is not enough. The objective has got to be someone actually understanding the risk of that product or that company or that issue, so it’s not unlike what we’ve always said in public relations. It’s not sort of passing the ball, it’s catching it. It’s not enough to just put out a press release or to tell someone something unless they understand it. So disclosure and transparency are fine, but they’re only the pass, if you will. So I think number one, as a profession, much of our profession doesn’t think that way. They think that disclosure and transparency is enough. It is clearly not enough.

The second thing that’s happening right now is the issue of corporate governance; it is such a huge thing. We’ve seen it with AIG and Lehman and everything else like that. Personally I’m quite involved in it. I’m actually a regulator today with being on the board of governors at FINRA (Financial Industry Regulatory Authority) and the New York Stock Exchange Reg. It’s not the old term back in the west, because I live in the west, of a regulator which was that after the Civil War they came around and burned farms and stole people. But there are those who might say that’s what regulators are. But the issue today for public relations is I think that much of our profession is missing this whole issue. Traditionally it has been with the investor relations people. Unfortunately, I think that most people in our profession today still think it’s over there; the issue of board governance; the financial issues around it; and I think this is a huge mistake.

What will be happening in the next year is we will have majority voting for directors. Today it’s plurality voting, which means that out of six million shareholders if my single vote is for a director and the other five million nine hundred and whatever vote withhold, which is the only other choice, the director is elected under plurality voting. Under majority voting, the majority now actually [has] to vote this director in. Can you imagine the embarrassment in a company if a director is not voted in? The investor relations people haven’t got the skill base or the relationships that can work that campaign, so we’re going to have majority voting, and we have more and more disclosure, we’re going to clean up the channels of communications between companies, boards of directors, and shareholders. All of this is going to happen in the next year; plus, plus, plus. And frankly most of the people in our profession don’t think that’s their job. I’m very worried.

Interviewer: What has changed in the PR Profession?

Stocker: I recently went back to my old alma mater and I was asked to give a speech for founder’s day. I asked the president, by the way, had she looked at my record at the college, she had said no and I said don’t or you’ll not invite me. So it was sort of wonderful to go back in that capacity knowing that they were not my finest years. But I was asked by a lot of students, so what’s happened in fifty years because it was fifty years since I had been back there. This profession probably has changed more in the last ten years or five years than it did in the thirty or forty years before that; and when you think about it, first, obviously the whole issue of media. When I got into this business, this business was media relations. The only way you talked to your constituencies was through the media, your shareholders, your employees even, and certainly your customers. People believed what the media said. They didn’t believe what we said, but it was the whole thing, well if the media repeats it, everybody believes it. What’s happened today is people do not believe what the media say. The research is very clear; they believe the media really doesn’t understand business and comes to the table with a skewed thought about business, an opinion. They actually believe what business is saying today versus what the media says. They want the source; they don’t want people to interpret information for them. This is an enormous change. Again much of our profession understands that, but some of it doesn’t. There are still media-centric places in public relations and it’s an old school dying part of our business, truly. Social media obviously is the living part.

The transparency we talked about; there are no secrets left. There used to be secrets. There are none; you can’t keep them; and that’s changed what we do. Diversity certainly, we’ve gone from concentration on content and people spending hours and days editing pieces of work to distribution is now the issue. Content is important, but it’s more can I get it to you? Can I get it to you in the right form and at the right time? People that came into this business used to be journalists. We hired them out of journalism schools; we hired them from newspapers. Today, they’re all coming out of business schools. If you can’t read a balance sheet, frankly you can’t do business as a PR any more. So business has changed enormously and I think some of the problems we’ve got are some of our academic programs and the people teaching them; they don’t understand. It’s changed that much, and there are some people in our profession who are in fairly important positions and don’t really realize it because they’re still back the way things used to be done. The question is what’s going to happen next; I don’t know, but it’s going to be great.

Interviewer: It definitely will be interesting.

Stocker: This profession is getting more and more important because of the changes. It used to be fairly easy. If I can get someone as a reporter to repeat what I had to say about my organization, my job was done. Everybody believed them; I got a pat on the back, a raise, and a decent bonus. Today it’s not that easy. First off there’s more diversity in my audience, there are more ways to get to them, they have all the information about us, and not just what I’ve just given to the media. The job is getting tougher. Therefore it’s getting way more important.

Interviewer: The Page Center has a PR firm that’s helping us get the word out about our scholars and the results of their findings and so forth, and I have been amazed with the releases, the reaction to that, the blogs, and the web sites that are responding. It’s absolutely amazing. Every day I get multiple emails. Well, it’s mentioned here and here. It’s amazing; news just travels very quickly.

Stocker: And they can look behind it. That’s the good news/bad news. We can tell people what we’re doing or how we’re doing something and they can look behind it. They can see what’s driving it. They can actually look at the people who are driving it and understand whether they are credible or not? What’s their background? This has never happened before. Again, it makes the job more difficult, but it takes a skill base that didn’t exist ten years ago, fifteen years ago. The social media is the new hot thing. It’s the blogs, twitter, and all that stuff; and that’s fine. Some people are organizing that well and some people are not. They’re just putting it out there. If we thought reporters had an opinion when they did something, blogs and everything else, and the Internet has way more opinions and you have to deal with that.