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The phrase, "labor relations management" once referred to maintaining good relationships with employees and, if unionized, any union representing employees, contributing to a good corporate reputation by making a company an employer of choice. Today, it's not such a simple equation because businesses must protect their corporate reputation from various groups that assume the role of fighting for workers' rights and advancing broad issues like human rights, environmental sustainability, social justice, and corporate ethics.
Brand management and labor relations management are more difficult when attacks on a corporate reputation can come from multiple directions. Technology, of course, plays a big role because people now have easy access to global distribution on the internet. Additionally, through streaming services of works like films and documentaries, podcasts, and videos, they can advertise their productions on social media, where billions of users are found.
One of the most powerful ways to attack more than one company is to attack the practices of an entire industry. This has, in recent years, take the form of documentary films, developed by people with a specific agenda of promoting widespread awareness. The harm that can be done to a corporate reputation is immense as companies can find themselves in the middle of a very public campaign, meant to force changes they cannot or may not want to make. The level of the harm often depends on how well these companies have prepared for a crisis through ongoing corporate reputation management. If your company finds its industry is targeted, whether or not you are is specifically mentioned, it's important to control the narrative by proactively responding.
Documentaries attacking whole industries are not new, but they are becoming more frequent and more sophisticated. The interesting fact about documentaries is that more than one group will often use them to support their positions. A documentary developed by a human rights group on poor working conditions in a particular industry can be used by labor unions to promote membership, or civil rights groups to support claims of industry-wide racism or abuses of undocumented immigrant workers.
Most documentaries mention specific companies, usually the most familiar brands, to back up their message. These specific companies must defend their corporate reputation as a member of the industry and to its distinct stakeholders. Another aspect of industry-focused documentaries is that they are frequently developed by collaborating groups, like labor unions and civil rights groups or human rights organizations and legal organizations. These features of documentaries make them powerful tools for increasing social and economic pressure on corporations.
Documentaries and films are becoming more common as people and groups decide to take their message to the general public in a dramatically entertaining way. The typical objectives include:
Documentaries are powerful tools because they appeal to the modern audience that prefers videos and films instead of reading, provide strong visual images, skew reporting to favor a specific agenda, and can be viewed at will on streaming services. When a documentary focuses on an industry's vulnerabilities, a variety of players inevitably are involved.
Documentaries often tell a macro-level story through the experiences and perspectives of stakeholders. Here are a few examples of documentaries and films that have led to attacks on whole industries and the companies making up the industry.
The 2019 film dramatized a true case in which attorney Robert Bilott brought a case against DuPont to contaminate a town with unregulated chemicals. Bilott is a corporate lawyer who once defended large chemical companies and then became an environmental crusader. In 2017, he won a $671 million settlement on behalf of 3,500 plaintiffs who claimed they had developed various cancers due to exposure to chemicals that DuPont knew were dangerous. Bilott is still pursuing cases against chemical companies that are intended to force them to pay for independent scientific research on the health effects of certain chemicals.
Dupont responded to new claims by referencing the industry as a whole by saying, "We are leading the industry by supporting federal legislation and science-based regulatory efforts to address these [PFAS] chemicals. We also have announced a series of commitments around our limited use of PFAS, including the [sic] eliminating the use of all PFAS-based firefighting foams from our facilities and granting royalty-free licenses to those seeking to use innovative PFAS remediation technologies." The Dark Waters film generated public interest in the chemical industry and its impact on communities and human health and brought pressure to bear on several companies.
This is a Netflix documentary that received a lot of exposure by winning an Academy Award. A Chinese-owned factory in Dayton, Ohio, hired American workers. The documentary captures many conversations in which factory management violates the NLRA by making statements not allowed.
For example, the film shows Chinese officials discussing firing American workers for trying to unionize, saying the plant will be closed if the workers unionize, and mentioning a lot of union supporters had been fired. "The plight of the workers at Fuyao is no different than the plight of workers in different parts of the country," said Brian Rothenberg, the UAW's director of public relations. Rothenberg wasn't missing a chance to take the union message national.
This film has a broad impact in several ways. It addresses cultural differences and has political implications. The former president of the Economic Policy Institute, Lawrence Mishel, pointed out the film speaks to issues the Democrats want to be addressed and are vigorously pursuing through various legislative acts. At the time the documentary was released, Democratic presidential candidates were calling for an overhaul of the NLRA, which materialized in the PRO Act. Mishel said the candidates are "competing in the Democratic debates about who can be the most pro-union candidate, and a number of the contenders have expansive policies, both in terms of unions and generally evening the playing field between workers and corporations."
The documentary series investigates the food industry for fraud, corruption, and the consequences of unsavory industry practices on human health. Mackenzie Hannum, a food scientist, writing for Science Meets Food, said, "They're making some major blanket claims about the industry as a whole…not just the industry in the United States, but they say even the whole global food industry is corrupt and fraudulent." The film explores the industry through segments like seafood, sugar, water, and chocolate. The theme of every segment is on corporate corruption and fraud to generate maximum profits and how corporate producers exploit farmers.
In 2018, Netflix released a documentary on medical devices. The film claimed the U.S. Food and Drug Administration and medical device makers put profits before patient safety. The film purports to show that some medical devices are not properly tested and are potentially dangerous to consumers. Owen Gleiberman with Variety wrote, "The Bleeding Edge" is about that paradigm-shifting corruption of the American system, but it roots its critique in an intimate look at the lives and medical complications of ordinary folks who'd put their faith in their physicians, only to emerge betrayed."
This 2021 Netflix documentary is also focused on perceived problems in the healthcare system. Premiered at the DOC NYC 2021 Film Festival in November, the documentary synopsis states, "INHOSPITABLE is a documentary feature film that exposes American hospitals' significant role in our broken healthcare system by documenting patients and activists as they band together to fight UPMC, a multi-billion dollar nonprofit hospital system that was making vital care unaffordable for hundreds of thousands of vulnerable patients in western Pennsylvania."
The documentary addresses how the healthcare industry takes advantage of the people it's meant to help and its impact on social justice. For example, a majority of hospitals (which are corporations) are nonprofits, so they do not pay federal and local taxes, which means counties get less revenue even as more hospital companies merge. Some of the issues that unions focus on are found in this documentary, like CEO pay and corporate profits.
Hospitals are the largest employers in many areas, and they are under intense scrutiny prompted by the COVID-19 pandemic. Hospital employees are saying they are short-staffed, working in unsafe conditions, unable to deliver the right level of patient care, underpaid, and stressed. Cornell University's School of Industrial and Labor Relations has tracked 30 healthcare worker strikes as of October 2020, and half a million healthcare workers resigned in August. When a documentary like InHospitable is released, it's more fuel for the union fire and damaging to corporate reputations.
Effective corporate reputation management means company leaders control the narrative because, otherwise, all the players in the situation will do so. Unless you control the narrative through the execution of a proactive strategy, the one-sided version - portrayed in documentaries and other media and supported by the various players like unions, a pro-union government, and consumers – becomes the new "truth."
Ideally, your leaders are able to activate a corporate management response plan that controls the narrative with the real truth before, during, and after an attack on the relevant industry or your company in particular.
Here are three strategic steps for corporate reputation management:
The internal and external communication plans must be aligned in effective corporate reputation management. The last thing you want is conflicting messaging. The internal communication and public relations teams may have different audiences, and the way they message may be different. Still, the corporate messaging must be consistent to avoid confusion or give critics an opening for further attacks and not damage employee engagement. Alignment of internal and external communication requires a comprehensive approach that is coordinated among your leaders.
There are two points to keep in mind. One is that your corporate reputation management strategy should include as many communication avenues as possible to better maintain consistency by not leaving openings for false information.
Second, match the resources to the issues that need addressing. For example, if a hospital is accused of not benefitting communities out of greed, share the annual report on charitable giving. If a retail corporation is accused of a lack of diversity, share the Diversity & Inclusion Report. Match your response to the specific claims.
Your managers and supervisors need to be able to answer questions that may come from many directions – employees, customers, investors, media, and even family and friends. Upskilling through leadership training is crucial to closing potential communication gaps internally and externally. Employees will watch the documentaries, news reports, and social media comments and have questions and concerns. If your leaders try to avoid answering questions or have no ready response, it strengthens the negative message.
Remind leaders at every level they are the voice of the company no matter where they are at the moment and no matter who they are talking to.
Remind the leaders in your workplace that they are the voice of the company, no matter where they are at the moment, and no matter who they are talking to. #corporatereputation #reputationmanagement
In 2001, Baumeister et al. wrote a paper titled Bad is Stronger than Good that has been used as a basis for other articles over the years. In this article, he makes the point many times that "Among journalists and communication scientists, it is considered common knowledge that bad events are more newsworthy and attract more reader attention. Periodic calls for the news to focus more on positive, uplifting stories get nowhere, not because journalists are sadists or misanthropes, but because bad news sells more papers."
He also wrote, "The greater power of bad events over good ones is found in everyday events, major life events (e.g., trauma), close relationship outcomes, social network patterns, interpersonal interactions, and learning processes. Bad impressions and bad stereotypes are quicker to form and are more resistant to contradiction than good ones." People take notice of bad news, which industry documentaries are usually about, and explain why they have so much power to harm a corporate reputation.
In Two Kinds of Reputation Management, Peter Sandman makes the point that corporations should focus on corporate social responsiveness rather than just corporate social responsibility. Companies should set up mechanisms to respond to critics and continue messaging them. Responsiveness is crucial to managing bad news, and it may include the company admitting mistakes, showing empathy, and conveying the steps for change.
The reputation stems from a variety of sources. The Public Relations (PR) communication process is a conduit for conveying information, using digital, broadcast, and print sources, videos, and social media platforms, blogs, and forums. The PR function works to move positive, truthful information to the front of critical media sources. The important step is to ensure the PR professionals know the narrative to promote, which was developed during strategic corporate reputation management planning.
Companies can develop a response matrix that identifies the appropriate response based on the negative statements made about the company. For example, claims of human rights violations need a different response than claims of underpayment.
Preparation is essential to managing public perceptions. Saying "no comment" to obviously negative media or inquiries will only cause people to believe everything said about the industry and companies is true. Preparation includes being prepared to address specific claims like employees are overworked, or the company lacks safety standards. Unions use resources like industry documentaries as proof employees need to join a union, and a union corporate campaign costs a company in many ways – further reputational and brand damage, harm to employer-employee relationships, and financial harm.
The important thing to do is respond directly to negative claims and proactively tackle a crisis. Perhaps the industry report has a grain of truth in it, but that doesn't mean it applies to your company. There are documentaries in which a handful of carefully selected businesses or employees are interviewed, but the truth is they don't represent most of the industry nor every company.
It's easy to escalate a crisis by ignoring the situation or saying the wrong things either to employees, other stakeholders, or the public. Corporate reputation management is a complex process, especially in today's world of technology that gives people numerous communication channels.
Manage your employer brand on an ongoing basis. The reality is that people are much less likely to believe the negative publicity if your company has vigorously promoted the company's culture and values and has a reputation for transparency, truthfulness, and positive employee relations.
IRI Consultants, along with the Projections team, can help your company prepare for any crisis with the potential to damage the corporate reputation. We offer a variety of resources that include management consulting services, corporate reputation management plan development, communication plan development, employee engagement resources, union avoidance tools, employee and leadership training, and more. Corporate reputation management is not something that can wait for the next crisis. It's needed each and every day. Let our team of experts help you create a custom solution that's right for you!
Walter is IRI's Director of Digital Solutions and founder of UnionProof & A Better Leader. As the creator of Union Proof Certification, Walter provides expert advice, highly effective employee communication resources and ongoing learning opportunities for Human Resources and Labor Relations professionals.