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Avow or Avoid?: The Public Communication Strategies of Enron and WorldCom
Unformatted Document Text:  Avow or Avoid? 23 In response to RQ1 (Is there evidence of cooperation between legal and public relations counsel?) the evidence seems to point toward cooperation between professions. This affirms recent findings about an increasing collaborative nature between the professions (Lee et al., 1999; Reber et al., 2001). The messages, and even attributed quotes from members of both professions, indicate a coordinated, collaborative communication strategy at both companies. There appeared to be no dominant communication strategy in either company (RQ2: Is there a dominant communication strategy in evidence?). Both professed openness but both engaged in finger-pointing and stonewalling. Enron’s news releases reveal traditional public relations tactics. Enron appeared open and cooperative with the SEC, even welcoming the investigation in an effort to clear its good name, and spoke of its intentions to restore investor confidence. It also backed up its openness to the investigation by appointing its own special committee of “independent” board members to conduct an internal investigation. In the releases, Lay is the spokesperson and portrayed as the leader of the company. Legal tactics are employed in the releases to the extent that the chief financial officer is replaced, making him the scapegoat, and the releases are forward-looking. Business will continue as usual. Everything is fine. In addition, the legal tactics used by Enron came through in the coverage. For example, the company shut down communication with the media other than via news releases, it failed to communicate with its employees, and it stonewalled or deflected the media away from the financial scandal. For the most part, the releases took the same tone and message during the three phases of the crisis, investigation, restructuring and bankruptcy. They differed in the middle period to the extent that Enron tried to blame Dynegy for backing out of the merger and thereby triggering its bankruptcy. Enron positioned the lawsuit as an attempt to recoup losses for shareholders.

Authors: Reber, Bryan. and Gower, Karla.
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Avow or Avoid?
23
In response to RQ1 (Is there evidence of cooperation between legal and public relations
counsel?) the evidence seems to point toward cooperation between professions. This affirms
recent findings about an increasing collaborative nature between the professions (Lee et al.,
1999; Reber et al., 2001). The messages, and even attributed quotes from members of both
professions, indicate a coordinated, collaborative communication strategy at both companies.
There appeared to be no dominant communication strategy in either company (RQ2: Is
there a dominant communication strategy in evidence?). Both professed openness but both
engaged in finger-pointing and stonewalling.
Enron’s news releases reveal traditional public relations tactics. Enron appeared open
and cooperative with the SEC, even welcoming the investigation in an effort to clear its good
name, and spoke of its intentions to restore investor confidence. It also backed up its openness to
the investigation by appointing its own special committee of “independent” board members to
conduct an internal investigation. In the releases, Lay is the spokesperson and portrayed as the
leader of the company.
Legal tactics are employed in the releases to the extent that the chief financial officer is
replaced, making him the scapegoat, and the releases are forward-looking. Business will
continue as usual. Everything is fine. In addition, the legal tactics used by Enron came through
in the coverage. For example, the company shut down communication with the media other than
via news releases, it failed to communicate with its employees, and it stonewalled or deflected
the media away from the financial scandal.
For the most part, the releases took the same tone and message during the three phases of
the crisis, investigation, restructuring and bankruptcy. They differed in the middle period to the
extent that Enron tried to blame Dynegy for backing out of the merger and thereby triggering its
bankruptcy. Enron positioned the lawsuit as an attempt to recoup losses for shareholders.


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