The Reputation Report: June 2024

In June’s edition of ‘The Reputation Report’, our experts provide insights into the month’s leading communications trends and reputational challenges. This month’s analysis covers Baillie Gifford’s battle with Fossil Free Books, new AI research published by Google’s DeepMind division and finally, Rachel Reeves’ slip-up around ‘working people’ and what this means in the context of effective political communications.

Baillie Gifford and its literary sponsorships:

Tim Jotischky, Divisional Managing Director, Reputation

When Ba href=",Israel%20and%20fossil%20fuel%20companies." target="_blank" rel="noopener" target="_blank" rel="noopener">cancelled its sponsorships of the Hay Festival and the Edinburgh International Book Festival after a campaign waged against it by a little-known group, Fossil Free Books, was it an act of corporate cowardice or did they call the campaigners’ bluff?

Fossil Free Books had demanded that Baillie Gifford divest from the fossil fuel industry and from companies allegedly profiting from Israel’s war in Gaza, winning the support of leading authors who threatened to boycott the festivals.

Far from staying below the radar, Baillie Gifford robustly defended its position, pointing out it invests just 2% of assets in fossil fuels – less than the industry average – and it is invested in companies such as Amazon, which many authors rely on to sell their books.

These issues are rarely simple. Baillie Gifford invests in chip designer Nvidia, denounced by campaigners as war mongers, but it was previously chosen by Sustainability magazine as the number one ESG stock to consider.

But it’s clear that the viability of these festivals is in doubt without corporate sponsorship. The campaigners admit they never intended Baillie Gifford to pull out – their objective was only to persuade them to divest.

Should the festival organisers have been more robust in standing by their commercial partners? Yes, quite probably.

For a small campaign group, Fossil Free Books achieved an outcome far beyond their expectations, but ultimately there are no winners, only losers, in this saga. Baillie Gifford have ended partnerships which, in some cases, dated back more than two decades; the festivals have lost important funding; and the campaigners failed to achieve their objectives.

For any business, deciding to take on a vociferous campaign group, rather than retreat, is a finely calibrated decision, based on an assessment of reputational risk. Will this turn out to be the high-water mark of the political protest movement? For a business, sometimes the best form of defence is to articulate and stand by its core principles.

The increased proliferation of AI-generated deepfakes:

Neil McLeod, Divisional Managing Director, Corporate

New research by Google’s DeepMind division outlines troubling, if not surprising, statistics on the use and purpose of AI generated deepfakes. It has revealed that digital impersonations of politicians and celebrities are twice as prevalent as using AI to assist cyber attacks.

The research – the first produced by DeepMind – outline the most common objective of deepfakes was to influence and shape public opinion. There are clear concerns over how this can be used in political misinformation campaigns, particularly with so many elections being held in various countries across the globe this year.

Also high up on the list of purposes for deepfakes was to cause reputational damage, with defamation ranking above fraud. This is a concern for both businesses and individuals and one that should be proactively planned for.

In light of Euro 2024, there were various deepfakes of the England manager, Gareth Southgate, “explaining” why certain players were left out or remarks about his team. Crude to most, but humorous to some the videos were reported by the BBC to have generated millions of views. However, even if not fooling most of those who watched them – there is clearly a threat in turning wild internet rumours into funny skits powered by AI and then seeing it shared en masse. There will be those who believe there is no smoke without fire and the sophistication of the videos clearly have a risk of skewing views and altering opinions of those they focus upon.

Not giving them oxygen is one approach, but there could soon be a tipping point at which it can’t be ignored. The DeepMind research underlines clearly that businesses and individuals need to prepare to do battle on the AI deepfake landscape on a reputation front as well as when it comes to cyber risk and fraud.

Rachel Reeves and ‘working people’:

Robin Brant, Associate Director, Reputation

Princess Anne is, famously, the hardest working member of the royal family. The King’s sister clocks up the most official events. She’s famed for her frugality and her well documented insistence on making her outfits last over decades. Yes, she’s had a life of privilege and wealth, but she seems to work hard. She fits the bill then for Rachel Reeves’ description when asked what are ‘working people’; ‘Someone who goes out to work’ was the shadow chancellor’s response on the Today programme.

Princess Anne has a work ethic many would admire. We don’t know what her income – and worth – is. But I’m as certain as I can be that Labour’s most powerful woman didn’t mean the likes of Princess Anne when she was trying to explain the type of people that an incoming Labour government would insulate from tax rises. Labour is laser-focused on ‘working people’ as the general election campaign reaches its crescendo.

Ambiguity often helps in political messaging. You can capitalise on the knowledge that what you’re saying could mean different things to different people. Keeping it broad could – should – widen the audience you’re appealing to. But then you get the Princess Anne problem. It borders on being meaningless. The other problem, as was highlighted in the BBC Radio 4 interview, is that key people delivering that message are saying different things to you. Keir Starmer had reportedly described ‘working people’ as those without savings to fall back on. Wes Streeting, the health spokesman – and one of Labour’s best communicators – had reportedly identified them as the middle and lower earners. Neither very specific. But each more so than Rachel Reeves, who narrowed it down to about 33 million people. Hedge fund managers among them. And Princess Anne.

I am sure it was a slip, an effort to fill time. I am certain that the Shadow Chancellor knows, in far more detail, the ‘working people’ that she intends to protect when she comes to write her first Budget in the autumn, if the electorate let her. A party with its roots in the trade union movement knows what it thinks ‘working people’ are. But Labour has chosen to keep its definitions broad and its fiscal commitments very limited as it tries to win this election. It’s a calculation that is proving challenging, which is why you get meaningless answers in some interviews. Meaningless answers that can make for a vacuous message. Answers that make an increasingly distrustful electorate think the politicians just aren’t being straight with them.

Being straight; a trait that the hard-working Princess Anne is well known for.

What’s in store for July?

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