Post-truth, an adjective describing “circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion”, was the Oxford Dictionaries 2016 word of the year. Its use increased by 2,000% last year, particularly in the context of Brexit and Donald Trump’s march towards presidential victory in the US.
The post-truth phenomenon has many guises. Fake news, half-truths, one-sided arguments and twisted, exaggerated or invented facts and figures deceive, manipulate and control the masses. The truth is irrelevant to those who can so easily advance political causes by feeding off the public’s deeply ingrained grievances and insecurities, and the growing distrust of the establishment.
In the run-up to the EU referendum, the Leave camp said Britain “sends the EU £350m a week”. The net amount is closer to £136m per week, less than 40% of the amount splashed on those battle buses. As for claims made by Donald Trump, fact-checking website PolitiFact has found 69% of them to be false or mostly false, 14% half-true and only 17% mostly true or true.
Kevin Morrell, professor of Strategy at Warwick Business School, says: “Post-truth isn’t merely about lying and although we associate it with politics, it also signals a loss of faith in regular news channels and a change in the way news is produced and consumed.” This year’s Trust Barometer by Edelman, the communications marketing firm, shows the traditional media is distrusted in more than 80% of the 33 countries surveyed. It is now viewed as part of the elite, politicised and unable to meet its reporting obligations because of economic pressures.
Michael Stewart, global vice chairman at Edelman, comments: “The mainstream media is under unprecedented pressure. Declining advertising revenues and resources have led to a reduction in the number of investigative journalists. Meanwhile, news outlets are expected not only to drive engagement via click-bait headlines, but also to keep up with instantaneous social media and get a story out fast. These factors can make it easier for fake news to go unchecked or be picked up inadvertently.” Edelman finds that people favour search engines over human editors. So sooner or later they stumble across sites impersonating news organisations, although Google has started shutting them down.
Or they turn to Facebook. According to Journalism.org, six in 10 US adults now get their news from social media. It is unsurprising then that during the last three months of the US presidential election campaign, fake election news on Facebook got more clicks, likes, shares and comments than real news stories from the New York Times, Washington Post and NBC News, a Buzzfeed News analysis shows. Facebook has recently started flagging “disputed” stories but its verification process is so long the stories stay unlabelled for days and have every chance of going viral.
The post-truth problem is also infecting the world of business. In November 2016, shares in the French construction giant Vinci fell by more than 18% after a fake press release said the company would restate its accounts and sack its chief finance officer. Vinci’s website states the hoax claim was first published by Bloomberg. It was then picked up by other mainstream media. Today every business needs to be ready to face this type of crisis.
Lily Kennett, director of intelligence at reputation and privacy consultancy Schillings, says organisations need to invest more than ever in information and preparation, and become much more imaginative, broad-minded and forward-thinking about how they achieve both of those things. She explains: “They need to take control of their information environment and consider what information is available about their organisation, their executives and key partners, and whether it needs to be in the public domain.” She adds that if the information is irrevocably in the public domain, they need to think ahead, consider how it might be used or misrepresented and be prepared to respond.
Planning for fake news is difficult, so being on guard for falsehoods as well as having agreed plans for handling such scenarios is critical, says independent board adviser Tony Friend. “This involves having real-time media monitoring, endeavouring to have the fake news taken down immediately and removed for search engines, and getting a clarification statement out to the market swiftly,” he says. Vinci issued an immediate denial, confirmed it was the victim of impersonation, and asked the French regulator AMF to investigate who could have benefited from the stock price manipulation.
Stewart says there may be circumstances when it is better to let the story play out, but adds: “Leading news outlets will set the record straight, but the business needs to correct those errors because mainstream coverage often drives opinion pieces, blogs and shares on social media that keep the false story alive,” he says. But he also adds that simply relying on the mainstream media and social channels to tell your true story is not enough. “Fostering direct, quality engagement with customers and stakeholders has never been more important.”
However, Kennett warns against knee-jerk reactions: “An analyst at a major investment bank recently told me that the speed at which a company issued a full denial of allegations contained in a research report was suspicious. The denial came minutes after the report was released so how could the company have read the report in such a short time, let alone assess the validity of the claims? The analyst felt such a rapid, comprehensive denial was aimed to protect the company’s share price and demonstrated an unwillingness to acknowledge and address concerns.” She adds: “You only get one shot at a first response, so you need to get it right.”
Arguably though, we have more access to truth. If the Panama Papers leak had happened a decade ago, the story might not have been written because no one had the technology and skills to make sense of such a massive dataset. Generally, however, Friend advises treating corporate leaks with caution: “Not every leak is the truth, let alone the full truth, so take care and work out who benefits from the story.”
Professor Morrell says information channels may be used as avenues for legitimate whistleblowing or for championing consumer or employee rights. But he also says: “Even such disclosures may be motivated by an agenda. We might get evidence of conspiracy and wrongdoing, but we never get the whole story. Leaking a corporate scandal prior to a takeover bid could distort the market badly.”
Crisis of trust
We have arrived at a point when the public may soon treat everything they read and hear with suspicion – unless we do something about it. The 2017 Edelman Trust Barometer shows that people are losing faith not just in the media, governments and NGOs, but also in business, at a higher rate than ever before. For business, the most concerning element is the perceived role the public sees it playing in the threat of lost jobs due to globalisation, immigration, lack of skills training and automation.
Yet the survey also shows that among those who are uncertain about whether the current overall “system” is working for them, out of the four institutions, people trust business the most. Kathryn Beiser, global chair of Edelman’s corporate practice, says: “Business is the last retaining wall for trust, but its leaders must step up on the issues that matter for society. It has done a masterful job of illustrating the benefits of innovation but has done little to discuss the impact those advances will have on people’s jobs. Business must also focus on paying employees fairly, while providing better benefits and job training.
“One of my clients moved ahead of the curve three or four years ago and introduced a living wage for all their staff, partly so that they were able to attract better quality candidates, but also to help reposition their corporate brand as one that was ethical and trustworthy,” says Stuart Cross, business strategy consultant at Morgan Cross Consulting.
According to the Edelman Trust Barometer, employees are now perceived as more credible than CEOs when speaking on every aspect of a company’s business, even financial earnings and crises. “If you treat them well and involve them in your future, they will help you not only get your message out but also protect your reputation,” says Stewart.
Leaders can increase their trustworthiness if they make themselves more visible and more “real”. Cross says: “Michael O’Leary of Ryanair is seen as someone who tells it like it is, as opposed to just being a corporate suit. If a situation arose in Ryanair, people would trust his version of events over the fake story. Or, at the very least, he would receive a reasonable hearing.”
Professor Zahir Irani, dean of the University of Bradford’s School of Management, thinks the post-truth landscape is an opportunity for organisations and their leaders to assert some clarity and to position themselves as responsible institutions with high standards of respect for truth, unbiased thinking and genuine expertise. “Brexit and Trump have challenged the need for experts and, in some respect, reset what defines expertise. Businesses need to be clear about the nature of their expertise – how experts get ethical training, and how they have an awareness of their responsibilities that impact the society,” he says.
Trust me, I’m an expert
Accountants have a big role to play in helping businesses achieve this, but “the profession could do with new thinking about how to respond to client needs in this new world”, says Henry Irving, head of ICAEW’s Audit and Assurance Faculty. “A strong, engaged, local presence in communities will help them promote the right business thinking and values.” Amid a popular backlash against the opinions of experts, the profession also needs to reinforce the view that professional expertise and scepticism are vital linchpins of trust. “We need to offer a USP in this sensitive space: accountants generally, and the globally branded firms in particular, are perceived by many as the self-serving establishment and therefore do not have populist credentials,” says Irving.
The ICAEW Audit Quality Forum is running a Believe me, I’m an expert? event on 12 June, on the value and limitation of experts in helping clients do the right thing to improve confidence in business.