How has the role of communications become more important to the C-suite over the course of the pandemic? Jim O’Leary, Edelman’s U.S. Chief Operating Officer and Corporate Affairs Practice Chair, shares key data from the 2021 Future of Corporate Communications study. Jim also discusses insights on how senior communications leaders are helping CEOs navigate social issues, ESG, activism and employee engagement.
Download the 2021 Future of Corporate Communications study here.
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About the Host:
HOST: DOUG SIMON
GUEST: JIM O’LEARY
DOUG: We’re going to take a deep dive into the 2021 Future of Corporate Communications Survey. And Jim, you’re the one who masterminded it, thought it up, took a deep dive into it. What are some of the key findings, especially about data that PR has become much more important in the C-Suite?
JIM: Hi Doug, thanks for having me on the show today. Thrilled to be here. I think the main headline of our research is that the role of corporate communications has become more materially important to CEOs, boards, and other members of the C-Suite than it’s ever been before.
DOUG: Right, now that should be good news for corporate communicators as well as the agencies that provide them. What are some of the implications that you’re finding? Is that building more trust in the corporation agency relationship, are you dealing with different people now?
JIM: Yeah, absolutely. So, I think when you think about the events of the past 18 months, you know, ranging from the pandemic that we’ve all been living through to the social and racial justice movement, all of the geopolitical tensions. And then you overlay that with some of the macro trends that have existed for a while now, including the fact that most companies are going through some form of transformation. All the technology disruption, this looming climate crisis, all these things combined mean it’s a heck of a lot harder than it used to be, to be the CEO of a company. It’s also more challenging to be on the board than it used to be because of all of these increased pressures. These pressures, more often than not, are in areas that corporate communications is directly involved. And that’s why the role of corporate communications and the Chief Communications Officer is more important than it’s been in the past, because CEOs are increasingly relying on their Chief Communications Officers to help them navigate these challenges.
DOUG: Yeah, and you interviewed 250 of the CCOs to get the information for the survey. While their work is becoming more important, what are the specific areas that may be affected more than others? Obviously, communicating with employees is huge and we hear the worker shortage, etc. But everything that’s happened, that’s really made it more important to have trust within your organization with your employees. How are you navigating that if you’re a Chief Communications Officer?
JIM: Yeah, great question. So, the areas that our research has identified as being the most significantly shifted and will probably remain shifting in the right direction over the foreseeable future are engagement with the workforce and in the workplace. So of course, employee engagement, that’s one, certainly, the role that business plays in society, and ESG and purpose. That’s another area that companies have increasingly prioritized, which of course, is no surprise given everything going on in the world and the increased expectations that exist for CEOs and some of the world’s largest companies, primarily around ESG. Another area that we’re seeing a fairly substantial shift is in the focus on the corporate brand or the enterprise brand. That is increasingly a priority for an investment area in that the CCOs are focused on. And then a few others, of course, the world is in a state of near permanent issues management, in some cases crisis management. And so, we’re seeing an increased focus on that. And then perhaps last but not least, given the fact that nine out of ten companies are currently in some form of transformation and 76% of those transformations are failing. There’s a much more widespread recognition that the role that communications plays in successfully enabling transformation is greater and more important than it’s ever been. So those are some of the areas.
DOUG: There’s a lot to pack there. Let’s go back to maybe ESG. I mean, people used to call it corporate social responsibility, and this seems like it’s more than a communications function. It’s really about with ESR, developing programs that are actually meaningful and then obviously communicating them well. Can you dive into that a little bit for us?
JIM: Yeah, absolutely. You’re absolutely right. It used to be not that long ago, for those of us who’ve been around for a while, a decade or two ago, where the CSR team had just recently evolved out of or was part of the foundation and had a very, call it more niche role. Now that is shifted entirely. And so, you have an increased focus on ESG, primarily ESG reporting, but even more so than that or equally important to that is what you were referring to, which is that companies are now being expected to do more than just take positions on issues which they’re increasingly doing, but also to take action on issues which they’re increasingly doing. And these increased expectations around taking positions on issues or taking action on issues come with increased pressure, increased scrutiny, increased risk. And the desire for corporations and leaders to speak out on social issues by the workforce, which is something that we are seeing more of is tricky, right? Because sometimes corporations like Patagonia that have been around and have been purpose driven from their inception, it’s a lot easier to be purposeful if you’re Patagonia than if you’re a company in a sector where it’s a little bit more complicated.
DOUG: Right, that does make a big difference. One of the things that you came up with in the survey that wasn’t maybe is wonderful is that, great it’s more important they need to rely on PR people and communicators more, but the resources are lagging. You would think they would push the resources in this direction because the C-Suite does seem to really understand or have a better understanding of the growing importance. This can be a survival, not survival, when you’re talking about managing the transition that’s been thrust upon organizations because of the changing world.
JIM: That’s right. That’s exactly right. So, if you think about it, you know, two thirds of the communications leaders who we surveyed, they’re investing more in employee engagement than they ever have. Three quarters are investing more in ESG and corporate purpose than they ever have. At the same time, the total amount of resource that is being dedicated to communications is not increasing very much. And so, communications professionals are being asked to do a lot more with either the same as before or just slightly more than before.
DOUG: Yeah, I guess that’s a challenge. So, it sounds like they’re just sort of shifting the pieces around instead of saying we need to be doing this and more of this and more of this as well. They’re also dealing with activists and multiple different levels and managing what is some of the findings there? And you mentioned that that’s raised the importance of corporate brand. How can you make sure to build this brand where if you take an action on something you said, companies are being required to do that now, it seems like you’ll be alienating half the people, whatever you do, and that’s just in the United States. How do you navigate that?
JIM: Well, so you just mentioned a number of different things there. Certainly, seeing an increase in our data reflects that in activism, investor activism, employee activism, of course, NGO activism. One of the main factors, of course, leading to the increased importance in communications more broadly. That’s largely what many of us have been doing for years is help managing situations around activism. What we have found is that the organizations that are very focused on what purpose and values often fare better in activist situations, which will probably be no surprise to you. The other thing that you that you mentioned in passing that I’ll come back to, because it’s very important, is that the communications team, the communications function of today, and the future looks much different than the communications team and communications function of the past. And for those of us who’ve been in the business for a while when we first started, a lot of the communications team within the company was former journalists and really strong writers. And while that remains important, a lot of what in-house communications teams does do includes media relations and employee communications. There’s a lot more to it now. And so, one of \our findings is that the communications function to the future needs to be much more multidisciplinary, much more agile, and much more insights driven than the communications teams of the past.
DOUG: Right. So now in your role, if you’re advising people within your own agency who work at the corporate practice or at other agencies that have a corporate practice, what do they need to be thinking of from the agency perspective to serve these needs in a better way?
JIM: Well, I like to think about it in terms of what they need just in general. And then if they can address those needs with their own in-house teams, then great. And if not, then they can look to their agencies for support. And what most of the in-house teams are increasingly adding more of is things like specialization in digital, data, analytics, comms tech. Until recently, I had not seen communications analytics functions within the communications team proliferating. But now I am increasingly seeing that in the past month alone, I’ve seen three Fortune 100 companies start to stand up teams around communications analytics or if they’ve already stood them up, begin to evolve them. I know of another company, one of the largest companies in the world that has an entire insights and analytics team that focuses on having very specific data that allows the communications function to measure, improve its ROI to the business and provide insights back to the business around all of the stakeholders that matter to the organization.
DOUG: Yeah, I was going to say that sounds like it could have an interesting effect on the agency roles because if previously the agencies were responsible for those insights, but now companies are taking that in-house. What would agencies, obviously, we’ll be getting data from the company to perform their tasks. But how will that influence the role of the agency going forward, do you think?
JIM: Yeah, I feel like there’s still plenty of opportunity for agencies in that space, and more often than not, the companies that are building these type of operations within there, they’re doing so in partnership with agencies. Given the fact that this is still a very new and emerging area and there’s a lot less established precedents on how to do it. And so, the people who have and the organizations that have done the most of it are the agencies who have built it out for any number of companies. The other thing that’s quite interesting is that we’re as tied to this trend is that we’re seeing new roles that didn’t previously exist in communications come to the forefront. So, while you may have seen a number of former journalists in the past, now you might start to see a data scientist, you might search to see more focus on creative and content, and all of these new areas are leading to communications teams, both in-house and agency being much more multidisciplinary than they had been in the past.
DOUG: Great, well, there’s so much that you can digest from this report. And with this post, we’re going to be putting up a link where people can go to it, download that information as well. Thanks so much for sharing your great insights. We really appreciate it.
JIM: Yeah, thanks for having me, Doug. Appreciate it.