Opacity Redux

Two separate but parallel discussions recently have caused us to revisit the issue of transparency and its bad-tempered twin, opacity.  Back in the early 2000s, we helped pioneer something called the Opacity Index which measured the extent to which a country’s sovereign borrowing costs and levels of foreign direct investment were impacted by levels of corruption, regulatory capriciousness, administrative speed, judicial transparency and a number of other factors.  In this index, opacity was bad and transparency good.  Similarly, in the fraught field of crisis communications,  the gold standard of crisis response has been ever higher levels of transparency.  Stakeholders, in this theory, are kinder to companies that are quickly and comprehensively disclosive.  And then we looked at Apple and BP.

In response to early complaints about signal strength and dropped calls with its latest IPhone, Apple was at first unresponsive, then petulant, before finally offering customers a “bumper” to put around their phone.  BP, by contrast, almost instantly flew its CEO to the Gulf, and while there have been many spoken gaffes, it has apparently been completely transparent and disclosive throughout the long unfolding of  the well capping process.  In spite of its sour behavior, Apple has sold boatloads of the new phone.  In spite of its attempts to be transparent in real-time, BP’s reputation continues to sink to new lows.

We are not suggesting a return to the evasive stonewalling at Three Mile Island in the 1970s, but is there, in fact, a lesson about corporate transparency to be learned from the Apple/BP contrast?  We’re not quite sure what it is, but it is telling that some of the most unfortunate moments for BP involved comments from Hayward and Svanberg about their feelings and the least appealing aspect to the IPhone story was the emotional disdain expressed by Steve Jobs for the media.  In the era of social networking, corporations are striving to find a voice that suits the intimacy and informality of the new medium.  This is proving more difficult than some had hoped.  Having a strong brand helps, but when the chips are down, people want corporations to get things right, not express their feelings.  The “get it” factor may be over-rated.

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