Does the PR Industry Have a Kleptocracy Problem?

The internationally renowned think tank Chatham House’s research paper in 2021 highlights that many powerful and affluent individuals are scrabbling to conceal that the UK has a kleptocracy problem. 

The Kleptocracy Issue

Since the rise of post-Soviet kleptocracies in the 1990s, its states and their elites have become a significant source of clients for UK-based services firms and investors in UK assets, contributing to the growing kleptocratic corruption.

The issue is nothing particularly new, yet it was only after the kleptocracy report and the full-scale Ukraine invasion that there was indeed a focus on acknowledging the problem at hand. Since then, almost half (45%) of the UK public associates oligarchs and kleptocrats with economic crime, and the UK government has introduced two Economic Crime Acts in response.

Through the first Economic Crime Act in 2022, the new Register of Overseas Entities held by Companies House was introduced, which entails how overseas entities owning land or property in the UK must declare their beneficial owners and managing officers.

In turn, a whopping 13,000 offshore companies failed to declare their ultimate owners by the January 2023 deadline, signalling that the problem might be even more profound than we know. But how have kleptocrats managed to conduct unethical activities in the UK for so long?

We could quickly point fingers at weaknesses in the law. Still, a significant portion of accountability falls to professional enablers who exploit these loopholes in service of the kleptocrats and their associates. A few of these professional enablers operate within industries such as banks, real estate, accounting, and news flash, the PR industry.

Evaluating the Ethics of PR

The two leading professional bodies in the PR industry, the PRCA and CIPR, have established clear ethical frameworks and guidelines. The PRCA Codes of Conduct calls for practitioners to “deal fairly and honestly with fellow members and professionals, the Public Relations and Communications profession, other professions, suppliers, intermediaries, the media of communication, colleagues, and above all else the public” while the CIPR Code of Conduct requires professionals to “maintain the highest standards of professional endeavour, integrity, confidentiality, financial propriety and personal conduct.”

Despite these ethical codes of conduct, many PR practitioners are still misguided or, in many other cases, choose to look away completely. Commenting on whether these ethical frameworks are fit for purpose, a leading academic and contributor to Chatham House’s kleptocracy report, Thomas Mayne, reflects, “The guidelines set by the PRCA and CIPR are strong, but of course, you don’t have to be a member of either membership body to do PR work.”

“The PR world, who aren’t regulated for money laundering purposes, can play a key role in, for example, bolstering a person’s reputation, opening doors for them in charities or politics, and really providing a kind of a laundering effect — not so much on the money but on the reputation of a person that can, perhaps inadvertently, have a negative effect on our institutions here in the UK.”

As a result, and to the detriment of the industry’s reputation, some PR practitioners enable and aid kleptocracies in conducting reputation laundering through various measures, including philanthropy, pressuring journalists and researchers through libel action, and supporting post-Soviet elites in entering high-society networks through donations to political parties.

To service or not to service?

As the responsibility and ethical considerations of choosing clients to partner with fall purely in the hands of PR companies and practitioners, we must answer a vital question: to service or not to service?

The truth is that an ethical PR firm that abides by the industry’s code of conduct must critically evaluate the ethics of its potential clients and have a duty to say no to clients who exhibit red flags throughout these checks.

Under the subject of kleptocracy, PR companies should be more wary of a few kinds of client categories, including PEPs (Politically Exposed Persons). They are frequently seen as high-risk because of their social position, function and influence in society. It is essential to carefully examine clients under this category to ensure they aren’t involved in illegal activities or financial wrongdoing because they have access to public resources and power over decisions involving substantial sums of money. This concern extends to the family members and close associates of PEPs, who are often suspected of undertaking the ‘dirty work’ for them.

Some PR practitioners would claim naivete over ignorance, but that fails to present itself as a strong enough argument when there is a responsibility and measures we can take to do our due diligence checks.

Thomas Mayne advises, “Make sure you’re getting a full picture of not just the country, but the person in question, to make sure you’ve got the full information about that person before you make a decision about representing them, because what they say to you might not be the full truth and what they say they’re going to do might seem quite harmless but may actually carry an ulterior motive.”

Many could argue that it is easier said than done, as the industry is also comprised of boutique PR firms who may not be able to access the necessary funds to conduct thorough background checks easily. Thomas Mayne recommends seeking an expert such as those in academia or NGOs or even visiting the British Library’s business section and going through media articles and company databases. It could also be something as simple as a few hours of research on the internet. 

Background checks should be done strategically, and different approaches work on a case-by-case basis, but we must not forget how research is a crucial component in PR. It is time for us to put those skills into practice before we take on a prospective client.

If anything, adopting a values-based, ethical approach to your client portfolio is arguably a much more sustainable approach. PR agencies that enable unethical clients are at high risk of reputational harm, such as in the infamous case of Bell Pottinger, which fueled racial tension in South Africa through its campaigns. Eventually, it led to their demise as they were publicly outcasted from the PRCA and deserted by clients and investors in an attempt to wash their hands off the scandalous association.

We often roll our eyes at the negative stereotypes associated with the PR industry. However, reflecting on these issues and the intricacies of ethical PR practices serves as a reality check that there is still a lot more that we in the PR industry can collectively do to improve the sentiment towards us, boiling down to examining one’s right to representation. To learn more about the PR industry’s kleptocracy problem and its wider implications, tune in to the PRCA Fuse podcast episode with Thomas Mayne on Apple, Spotify or YouTube.

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Curzon PR is a London-based PR firm working with clients globally. If you have any questions, please feel free to contact our Business Development Team bd@curzonpr.com