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Restoring reputation proves costly for Alcoa

FRUSTRATION at the media’s treatment of what it considered important information has forced an embattled Alcoa to look to advertising to get its message across.

A full-page advertisement in The West Australian included the results of a WA Health Department study into the incidence of cancer in communities living near the Alcoa operations.

With a $16,000 price tag it was a costly strategy.

With so little actually understood about the causes of cancer, Alcoa didn’t feel it could address community concerns with a simple statement of denial.

Alcoa public relations manager Brian Wills-Johnson said it was a situation where there were two sets of evidence relating to the incidence of cancer in the area.

“One (of which) was consistent with the risk of a cancer outcome if you were living near our operation, and we also had a paradigm where this was not the case,” he said.

“There are varying levels of understanding of how the media operates and there was some frustration amongst management that our message wasn’t getting across.”

Alcoa featured in 10 front-page news stories in local and regional press, including one with the headline, “Cancer Street”, relating to a cluster of cancer victims.

While Alcoa responded at the time of this story, there was mounting concern within Alcoa, from both management and staff, that the company was not doing enough to get its message across to the public.

“We felt there were various ways to continue to answer these allegations,” Mr Wills-Johnson said.

“One was to continue to work with the media, and the second was to build a bank of information on the website.

“Thirdly was to advertise, which gave us a way of getting the message out to the public, which would not be filtered by editorial.”

Alcoa already had invested in an internal campaign to maintain its staff’s understanding of the health issues.

The battle to retain a strong public profile is essential for a resource giant such as Alcoa in order to continue its operations and attract first-class human resources.

Aside from supporting the Alcoa operations, a strong community profile provides an increasingly valuable marketing tool for major corporations.

Testament to Alcoa’s commitment to its reputation in the community is the company’s high standing in the 2001 Good Reputation Index, compiled by the Sydney Morning Herald and The Age.

Porter Novelli UK director of planning, research and evaluation, Paul Miller believes the success of a company can be measured by its reputation.

Although reputation profiling is more advanced in both Europe and the UK, the drivers are similar for Australian businesses.

Mr Miller stressed that the impetus to develop a strong corporate reputation must be driven by management and then filter through the ranks of the company.

“The area of corporate responsibility is becoming a more recognisable and expected area of business,” Mr Miller said.

“The main factors for reputation profiling are financial performance, leadership and the vision of the leadership, the quality of pro-duction and service and the way the company handles employee relations.

“These are the broad overall measures of reputation standing, which we benchmark against other companies.”

From a public relations perspective, Alcoa’s decision to use an advertising format probably reflects the level of concern in management.

Atticus principal Paul Plowman said a message in advertising, rather than editorial, can adversely affect the credibility of the information.

“It probably reflects the degree of frustration in getting their message out into the media,” Mr Plowman said.

However, it’s a tactic employed by Government at both a State and Federal level to respond to issues and disseminate information.

“When the message is controlled the credibility is diminished be-cause of the perception of editorial over paid advertising,” Mr Plowman said.

“It has some effect in being able to clearly articulate your message, but it’s very limited.

“With the content that Alcoa put into the advertisement it’s difficult to assess whether it addresses the issues that were raised.

“Apart from the credibility issues this strategy can also be difficult to quantify or measure in terms of effectiveness.”

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6th↑CBH Group$3.10bn
7th-Alcoa of Australia$3.00bn
8th-Roy Hill Holdings$3.00bn
9th-Chevron$2.90bn
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