AIG CEO’s Comment Goes (Deep) South

 AIG CEOs Comment Goes (Deep) South

THE PR VERDICT: “F” (Full Fiasco) for AIG’s Robert Benmosche.

Five years ago, when AIG was rescued by the US government, the insurer became the poster child for everything that had gone wrong in the financial services industry – inflated balance sheets, insufficient controls, and corruptive bonuses. The company then embarked on the steep path to restore its financial health and reputation. Led by Robert Benmosche, appointed CEO in 2009, AIG underwent a drastic turnaround, with uncompromising cuts to its balance sheet and work force. As a result, the US government was able to exit its investment with a profit of $22.7 billion and, in August this year, the company announced higher profits as well as its first dividend payment and share buy-back since 2008.

All’s well that ends well? Not quite. Benmosche managed to turn his interview with The Wall Street Journal from a PR opportunity to a disaster by comparing the 2009 outrage over AIG bonuses to racism in the Deep South. The uproar, he said, “was intended to stir public anger, to get everybody out there with the pitchforks and their hangman nooses, and all that – sort of like what we did in the Deep South…and I think it was just as bad and just as wrong.”

AIG’s staff undoubtedly worked hard; without them, the government bailout would have ended in tears for shareholders and tax payers alike. Nevertheless, the public cannot be expected to offer sympathy or gratitude. If Benmosche wanted to make employees feel better, he achieved the opposite. After a long crisis, all they wanted was to get on with their jobs, without battling constant controversy around their employer. Hard luck.

THE PR VERDICT: “F” (Full Fiasco) for AIG’s Robert Benmosche.

THE PR TAKEAWAY: Some fights can never be won. Executive interviews have some absolute “don’ts.” The most important is to never – ever! – compare anything that happened in an industry or in a company to a historic event rife with human suffering. The comparison will always sound deluded and bring out debate that widens the issue not narrows it. Compensation is also better left untouched, especially if it has already been under fire in the past. Executive pay was a PR battle AIG lost years ago. When coming back from a crisis, remember no headline is always preferable over a bad one.

The PRV Report Card: This Week’s Winners and Losers

 The PRV Report Card: This Weeks Winners and LosersPR WINNER OF THE WEEK: “A” (PR PERFECT) TO Malala Yousafzai. The teenaged Pakistani activist who defied the Taliban and agitated for education for young girls like herself  was shot in the head last October. She defied the Taliban yet again by living, getting well enough to ask for her schoolbooks, and leaving the hospital under her own power earlier this week. The savvy teen has made sure to be photographed upright and strong, looking ready to take on the world. And the world stands by this young vision of inspiration as she transforms herself into an iconic figure of resistance Brava!

 

 The PRV Report Card: This Weeks Winners and LosersPR LOSER OF THE WEEK: “F” (FULL FIASCO) TO AIG. Instead of celebrating the launch of their brilliant advertising campaign, they were inundated by headlines blasting the company for potentially joining a lawsuit against the US government over its bailout. AIG’s board decided not pursue the claim, but the damage was done – and at least some of it was self-inflicted. The juicy tidbit was discovered by The New York Times in court records. AIG may have fared better by proactively explaining to the press that it had a legal obligation to consider the matter. Instead, it appears management hoped the whole issue would go unnoticed. Tsk, tsk.

 

 The PRV Report Card: This Weeks Winners and LosersTHE “THERE’S NO ‘THERE’ THERE” AWARD TO Gwyneth Paltrow. The former vegan turned roast chicken-eating cookbook author has let the world know, via her GOOP.com site, that she is not on a diet, not on a cleanse, not detoxing, nor doing anything rail-thin actresses usually do. “For now, I would like to continue with my pasta and cheese,” writes the Academy Award winner, who has a second cookbook coming out soon. We suppose we should applaud an actress admitting that she eats, but somehow this cynical PR exercise seems so . . . so . . . so what.

Our Favourite PR Turnarounds of 2012

This year saw some celebrities, companies and even countries turn their own PR corner and we had a hard time choosing our favourite three for 2012. While they haven’t consistently made the headlines, each pick proves that image rehabilitation is always possible.

2013parishilton 150x150 Our Favourite PR Turnarounds of 2012Paris Hilton is ending the year visiting orphans in India and sick children in Los Angeles, routine trips for the 31-year-old celebutante these days. With her name once synonymous with “bad girl”, Ms. Hilton seems to have left the days of sex tapes and cocaine possession behind. She’s revamped her image by staying out of the limelight while showcasing her business acumen, building an eponymous global chain of retail stores and a fragrance line estimated to top $1 billion in sales. Her news clippings, about new shop openings and charitable acts, reflect the reinvention: privileged brat no more. Lindsey, take notice.

 

2013myanmar 150x150 Our Favourite PR Turnarounds of 2012Myanmar, long known for its oppressive regimes, overhauled its image on the world stage with its transition to democracy. 2012 saw ex-political prisoner and Nobel Prize winner Aung Sun Suu Kyi and her party elected to parliament, the lifting of censorship laws to create a nascent free press, and the central bank floating the kyat to allow for normalized investment. President Thein Sein’s reforms have resulted in relaxed U.S. trade sanctions and even prompted a visit from Barack Obama, the first sitting U.S. president to set foot in the former Burma. All this sends a great message to the world: democracy rules!

 

2013AIG 150x150 Our Favourite PR Turnarounds of 2012The U.S. government last week sold off its remaining stake in AIG, the insurer deemed “too big to fail” and the largest recipient of a much-maligned government bailout four years ago. The sale marks one of the most impressive turnarounds in U.S. business history and the resurrection of the AIG name. CEO Robert Benmosche was eloquent in his statement, thanking the country “for giving us the opportunity to keep our promise to make America whole on its investment … Thank you America. Let’s bring on tomorrow.” AIG’s name, like its stock, appears to be on the up and up.