Ethical Issues With Product Recalls and Cannabis – Loring Barnes

Joining me on this week’s episode is Loring Barnes, APR, Fellow, PRSA. Loring is an independent practitioner with more than 30 years on the front lines of transformative communications. She is also the chair of her town’s Selectboard where she has grappled with cannabis legislation and other topics. She is a tireless advocate for the profession.

Loring discusses a number of key ethical issues including:

Why don’t you tell us a little bit more about yourself and your career?

I’m largely an agency brat to say it succinctly.

That’s really how my career unfolded from my early days, promoting products like Oscar Mayer and McDonald’s. I’ve worked in major markets both in Boston, Dallas, and Philadelphia because that’s where my family moved at the time. And so rather than fight change, I learned very early on that if you embrace change then opportunities come.

My work has spanned almost to every conceivable consumer facing or business facing profession, ranging in size and complexity of program from something small and tight, like a product launch, to something far more complex, such as consumer research that informs the repositioning of a mature brand and reintroducing it into the marketplace. And I’ve had a lot of success stories that go across topics such as 401k legislation, beverage launches, transportation policy and HIV testing. When change presents you with opportunity, you grab the opportunity and that’s how you grow.

Thinking back over all those opportunities and all the areas you have engaged in, what is the most difficult ethical challenge you ever confronted at work?

I think that whenever you see something that the boss of the organization is either seeing but not reacting to or it has turned blinders on, it is a challenge. And your boss could be the governor or your boss could be a CEO. When you know that you have a problem that’s going to adversely impact and derail both the organization’s purpose and customer trust, then you’re in a position where you absolutely have an obligation, a Hippocratic oath, if you will, to stand forward and to communicate to them that there is a problem and there is a need to act decisively. And I think the lesson for me, having done that both inside of government as well as for private industry, is that you have to trust your gut and remember that in ethics your personal reputation is not separate from the organization, because you are an extension of them even if, even in fact if you are not an employee of them.

Can you give any detail about some of the ethical challenges you faced?

I certainly have a lot of experience with product recalls. And the time to wish that you had a crisis plan in place and that you had funded this and that you had tested it and operationally updated it on an annual basis is not when you have a very well respected but extremely determined consumer reporter standing at your door asking you why it is that you have for years been ignoring a product failure that puts infants and toddlers at risk.

I had that situation with a longstanding manufacturer of children’s inflatable pool products. And the organization had data that they were collecting with respect to failures of an inner tube type product that had a frail infant seat that would potentially rip and obviously the consequence could have been catastrophic.

Two years before that consumer reporter showed up at this organization’s door, they had talked to me about putting in place some mitigation communications practices to address what they had identified through a whistleblower. And then they failed to do so. They were really tested and they frankly deserve to be tested. And we were effective in helping them to navigate that.

In kind of the same vein, I think you’re aware of a fairly famous product fail, which was a tent that was manufactured by a very respected European outdoor product manufacturer and they had come to the US and we had just guided the company’s most successful national consumer product campaign, which was PR driven with very light, but creative advertising support. The advertising agency had launched ten second ads, which in its day were considered extremely revolutionary, but it underscored the value proposition of this tent, which was that you literally threw it up in the air and it unfolded. This was a tent that had received international design awards.

Well, when you do that and the ad tells you that next we will invent instant campfire – you are not expecting somebody from within the organization to come to you and say, “You know what? We’ve just discovered that this tent has not satisfied the more stringent fire-retardant standards of the USA. It had passed standards that were considered at a lesser level from overseas, but not in the US.” And I am the person who stood forward to the then US CEO and said, “We need to act. We need to stop the work that we’re doing and we need to do a 180 and we need to get these tents back.” Because not taking a decisive and ethical action is to have left infinite numbers of families and children potentially at risk because where do you use a tent? You use it when you’re camping. And probably you have a campfire nearby. So, this was just a potential scenario for disaster.

And what ended up happening, Mark, was the CEO did not want to stop the campaign because he knew what we did on the other side, which was it was terrifically successful. Our work had really paid dividends. There was a very high return on the campaign investment and very high response by consumers across the country for a brand that had very little national footing at that time. And I pulled the plug on the campaign. I said, “You know what, I’m sorry but this is not only your corporate reputation, but this is my reputation and that of my team and it is wrong to continue to do this.” And we ended up going to Europe and explained to the corporate leadership there why it was that we felt that this was the action to take.

At the end of the day, they recognized the ethical decision that we had put before them and they released the services of the US CEO. And we proceeded with a product recall with the consumer product safety commission. We did the right thing.

I think those are two great examples and it shows a dichotomy. One where companies, a company didn’t listen to you and another one where they did. And what’s your advice when you’re facing that situation and you’ve uncovered or behavior or something that would be an ethical or a wrong and need to change it? how can you really get the attention of the senior executives?

This is where the internet is your friend. It is not hard to find a story that has a parallel track of a problem that you could indicate to be transferable and instructive. So, when you say, “Hey, this is not a new road, but here are the consequences that these other organizations suffered.” And when you are able to show the cost, the true revenue cost and impact from doing the wrong thing, you’re definitely going to have some stronger footing for showing them that redemptive action is always the way to go.

I think that there’s no shortage, sadly, of stories where reputations have been eroded on the part of individuals, leaders and certainly brand organizations when they have done the wrong thing. You can easily point to them and say, “Do you want to travel this path? And if not, these are the steps that we need to take. And I have the professional training and confidence and department to guide you through this. I understand that an organization is not just the people from within side, but it’s all these other stakeholders and that the messaging and the activities that you need to take are very different.”

And that’s why this is a professional discipline that you and I are in, a course that you teach, because it sounds so simple and easy, but an ethical response that is effective is a very complex undertaking and you need professionals at the helm.

I saw this with Fisher Investments. I’ve been reading about where their CEO said some inappropriate things, it cost them $3 billion in investments – and people are now criticizing their response where they did it in a way that some people think is very inauthentic and doesn’t address the initial issue. That really shows why you need that wise counsel and the PR people involved.

I think that the expression walk the talk is very simple to understand here. Bad behavior never happens privately. It happens in public. We all have a cell phone. We’re all whistleblowers. And it’s really important that any organization, be it a small, locally focused nonprofit or a large, global monolithic brand. They may both set ethics and reputation policy and perhaps a corporate organizational mission at the corner office policy table. But to make it come to life requires your employees, your customers, your constituents and all your other stakeholders.

An organization doesn’t own its ethical reputation. It has to live an ethical reputation, but the referendum on how they do and how they behave against an expected moral compass happens well outside of the corner office and that’s how any organization recruits and retains talent, which foremost are the most effective and credible. And to your point, authentic ambassadors for what the purpose of any organization is. And without that understanding, you’re missing a major gap in the lifeblood of any organization’s growth and success.

You mentioned a referendum. A few years ago in Massachusetts, there was a referendum on legalizing cannabis and you’ve been at the forefront of this due to your work on the as Chair of your town’s Selectboard. Can you tell us more about ethical issues you face there and what you’ve looked at as marijuana was coming to your town legally?

I’ve actually been on kind of all sides of it. I’ve not only been on the governmental and policy setting side, but I’ve also been counsel (unrelated to that) to a very interesting technology driven organization in the cannabis sector. And when this was all happening, I felt that my job was to understand all sides. I read blogs and books on the topic that covered both ends of the spectrum. From the sky is falling end with very heartfelt concerns about the impact and erosion to what we know to be society as a whole, to the economic indicators that have been a driving force for the acceptance of cannabis in addition to the unfolding medical and clinical research that indicates how cannabis product elements are really changing the face of pharma and wellness.

Only by understanding all sides, could I stand before my town as a government leader and say, “I hear you and I have listened and I’ve gone out to do research.” I have family in Colorado and I visited them. I wanted to understand things like security. What was the customer exposure and experience? What was happening in the towns with respect to any impacts, positive and negative? By doing that I had upheld an ethical responsibility as a trusted elected official in the microcosm of my town, to understand all the concerns. Only by educating myself could I navigate them and advocate, I think, in a very balanced way.

And that’s really what ethics comes down to. It’s approaching the any issue or any organizational challenge from the middle and looking out at all the potential stakeholders. And I think one of the things that made our town really pull together was that we did everything in a very transparent fashion.

Some of that is required, obviously, by governing. But we focused on creating a safe place where people could come and express their views, no matter how extreme, no matter how ill or under informed. And then we were able to put in place experts, again, on all sides to address them. And I don’t know that you ever satisfy everybody on a controversial issue, such as whether or not you want to welcome a new industry, such as cannabis, that is unfolding where the legislation and the policy and the business practices are really very dynamic. But what you can definitely agree with is that the process of having this conversation was held with a spotlight on it in an open forum and where every citizen’s voice was protected and mattered.

That helped us. It guided how we ultimately brought to the town the decision to welcome this industry. And as a result, we have just opened our first combination adult use and medical dispensary and we have zoned for future opening, a separate and unrelated business entity as a grow facility. And I will tell you from a policy perspective, what I felt was important to understand and to communicate ethically was that our society has changed. Cannabis is here and whether or not we individually like it or not, in our state, in Massachusetts and across the country increasingly, the decision on welcoming cannabis has already been made.

Ours was not to legislate a moral decision, but to implement the will of the people. And I’m really proud of what we did. And I think that the fact that the impacts to any community are going to be budgetary for a town, it’s really important. It was important to me to have those impacts, not hit the taxpayer, but to be funded by the industry that from which these impacts were happening.

That’s a really great overview and I think you’re right about being transparent and letting people understand what’s the process for any decision. You are never going to keep everybody happy, but as long as they know the process and are comfortable with that, you can usually get to some agreement.

We’ve been really lucky and this is very new for our town. It’s somewhat new for our state. The state infrastructure is learning as it goes. There is such exciting work that is being done on the wellness and pharma end, cannabis, that I’m glad that we’re in on the ground floor to kind of see where it has the potential to go. And I think if everybody can keep an open mind, we can navigate any adversity and we can celebrate and embrace any benefits.

Beyond your own personal activities, what do you personally see as some of the key PR ethics challenges for today and tomorrow?

I will tell you the Warren Buffet quote, which I know from listening to Ethical Voices has often been invoked by your guests. But I have to say it’s seminal in our profession. It takes 20 years to build a reputation and 5 minutes to ruin it. And if you think about that you will do things differently and we don’t have to look far for those stories.

Brands like Theranos, the challenge that has hit higher education in the University Blues college admission pay to play scandal, and very recently the recurrent conversation at Oberlin College, which is not unique for having been alleged to have participated in some manner in what was a very distressing bias incident or racial incident and one that has the potential to have long legs as a conversation.

The challenge for our industry continues, strangely, to be that ethics is a leading professional discipline. And when we use the term reputation management, I don’t think it’s really management, because we don’t really own our reputation. I feel like it’s reputation navigation. It’s a very dynamic discipline.

You and I both know every day is about change. You never know what’s going to happen. And what has been somewhat gratifying for our profession is ESG (environmental, social, corporate governance), which appears now to be the successor to corporate social responsibility, CSR. At the end of the day, no matter what you call the duck, if it walks and quacks, it is a duck. And it boils down to reputation and ethics and doing the right thing. And I think that our industry continues to have to be its own best advocate to have a seat at the corporate table and to be able to illustrate the importance of having professionally trained leaders in place who can keep their hands on the wheel or the tiller of the ship of the brand to steer it to its intended moral and social impact compass.

So how can we get businesses to the more ethical place? I mean I know a Business Roundtable came out in August talking about it’s not just shareholder theory, it’s truly stakeholder theory, but do you believe there’s more we should be doing on the education front?

I believe the Business Roundtable statement will end up being somewhat of a case study for us. I look at everything from both sides now. And I think what’s interesting is that there was a long tail and continues to be a long tail of conversation around the pronouncement that for organizations to be effective they need to bundle social impact against profits and in fact maybe prioritize them. There’s been, I think, some worthy discussion both about the message and the messengers.

For the public relations profession, as the leaders of integrated communications and integrated marketing communications, we have to start at the ground floor. I think the way to do that is to teach ethics and make ethics a cornerstone course at any university. It shouldn’t be relegated to an upper class level class, but rather an entry level required course that all freshmen coming in the door are going to have to take irrespective of their intended course or major because ethics and the impact of acting unethically impacts your organization and your career, whether you are in a business discipline, a nursing or medical profession, a political or legislative professional, in education, a consumer facing product or research.

No matter where you’re going, ethics matter – as we’ve seen in all these different examples of companies crashing and burning because they’ve either had the wrong leaders in place or they haven’t been responsive to an ethical dilemma. We have seen stock prices fall. We’ve seen companies, IPOs fall apart and become devalued. We’ve seen donors pull up stocks when it comes to a university giving, because situations are handled badly. And if we are teaching at the university level, the future generation of leaders and careerists, no matter what their professional or trade or educational or vocational pathway is…ethics matters.

I think right now it’s too distanced and it’s very nuanced and not enough universities have it. I’m actually advocating a university at which I teach that they adopt an ethics class and I’m going to continue to do that work. And I think that our profession has leaders all over the place who could give of their time and their knowledge to help universities to do that and I think it would be really beneficial. It could be a sea change.

I’d say it should be not just the one class but also make sure it’s integrated throughout all your courses, because ethics is a core element. I know a lot of communications schools are doing that right now, making a public relations ethics not just one standalone course, but making sure we’re touching on ethics throughout the four years to keep it top of mind. And I’d even argue it should be starting before college. Start looking at it in high school as well.

It’s a great conversation to have. How do you make a decision about what product you’re going to buy? What’s really interesting for us is the Gen Zs to be followed by the Gen As, and certainly with a conversation begun by millennials, who are now getting older, have really helped companies and brands to understand that we make decisions as to the products and services that we purchase, not just on the basis of those products and services themselves or their price or their convenience, but also based upon the values upon which the brand stands. And at the end of the day, that’s often a tipping point in favor of a brand that in fact might be priced not as advantageously as some of the competitors.

But we really do buy ethics. Ethics is an economic indicator and to have that understanding explored in the classroom and to bring conversations in about why you might buy a certain pair of jeans or a certain brand of sneakers or a certain cell phone or electronic equipment, I think is extremely relatable and would be a really interesting pathway to explore that level.

What is the best piece of ethics advice you were given?

Well, I may not be unique in this, but probably my parents who said to me at a point of crisis that honesty is the best policy. They said this when I burned a pot and buried it in the backyard because I wasn’t sure how to explain to my mother that her double boiler was now completely ruined. Or when I had pilfered some of the Halloween candy and ended up having to stand the front door of that year and hand it out, because in my parents’ eyes I had already acquired and consumed my fair share.

They told me, and I have learned through my own life, that honesty is the best policy. You get through it, even if it’s messy.

I think our country in particular is very favorable to redemption stories. I look all the time to Martha Stewart, who I feel personally (and I think that this is a widely shared belief), went down hard. The spotlight was on her, not just for her alleged transgressions, but for who she was and the advantages that she had. Therefore, it made what might’ve been an illegal act all the more glaring. And she got through it and she has redeemed herself.

And I think that if you can point to stories like that, whether it’s Tylenol or other products that have had problems but have come back stronger for learning, and you find out that when the company acts honestly, they are reflective and they try to do the right thing. When they come back to all of their stakeholders, starting with their employees, their most trusted brand and cause ambassadors, with an articulate message, an act of decisive improvement, and you share that process and you come back and you check back in. Those are the stories of the durable brands that weather the test of time. And so be honest, be willing to have the tough conversations.

Crisis and ethical dilemmas are messy. They are uneven. They are not convenient. They never happen Monday through Friday 9:00 to 5:00, with weekends off. And they never happen when you have a plan in place. They always happen when you are ill prepared, when you are shutting out the conversation, pretending that doing so will make it go away. And we should all know that in our era of citizen advocacy, that’s never going to happen.

The best course of action is to stop, listen and listen broadly, get the right people in the room with the right type of expertise who touch all of the stakeholders and to act and to do so with integrity. And that boils down to what my parents told me. If you bury the pot in the backyard that you burned and you are not honest with us about it, the punishment is going to be harsher. And in that particular case, it took me more than a decade to come clean. I found that at the end of the day when I was honest and I did admit to taking, to breaking into the Halloween candy ahead of trick or treating hours, that the path of redemption was far shorter and far more pleasurable. And yes, the lessons were instructive, I learned do not break in to the Halloween candy.

Listen to the full interview, with bonus content, here:

 

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Mark McClennan, APR, Fellow PRSA

Mark W. McClennan, APR, Fellow PRSA, is a senior strategic communications professional. He has more than 20 years of tech and fintech agency experience, served as the 2016 National Chair of PRSA. drove the creation of the PRSA Ethics App and is the host of EthicalVoices.com
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