Edelman loses contact with China CEO Steven Cao, ‘It is our understanding he is cooperating with the authorities’
Steven Cao talks about his appointment in 2012
PR agency Edelman has lost contact with the boss of its China operation, Steven Cao.
His absence from work emerges a fortnight after his former business partner, now a prominent TV anchor, was detained by the authorities in a corruption probe.
Rui Chenggang, who with Cao co-founded Pegasus Communications in 2002, the Chinese PR agency acquired by Edelman in 2007, was taken in for questioning in mid-July.
The enquiry is believed to be over an equity stake he still had in the PR agency while working for broadcaster CCTV.
In a statement about Cao, who is CEO of the Daniel J. Edelman China Group, the agency said: “It is our understanding that Steven Cao is cooperating with authorities on the investigation. We have not been in contact with Steven, so we don’t have any further information about Steven’s whereabouts.”
“For now, senior China management is overseeing operations at the company, and business in the country is running as usual,” the agency stated.
Rui did not sell out of Pegasus Communications completely until three years after the acquisition had been made and he’d since moved on to CCTV. Edelman has said that the transaction – Rui selling his shares to Cao – “took longer than expected”.
During that time services were provided to CCTV by Pegasus – the agency sourced a studio for Rui’s show for the World Economic Forum.
Rui’s detention is presumed to be part of a broader drive by the government to tackle corruption at CCTV.
Cao was appointed CEO of Daniel J. Edelman China Group, which houses four different agency brands, in 2012. He talked about his appointment and the group offering in a video address in October of that year.
There is a very interesting back story to this, and one that is not exclusive to Edelman. Namely black PR in China: using paid media to promote clients (or denigrate rivals) – whether paying for print articles, Weibo zombies or other so-called ‘earned’ spots.
In its statement, Edelman says “we won’t pay for coverage”. Anyone who has worked in PR in China would be very surprised at that statement. Or maybe the agency is just being very clever with its use of tenses.
Once again, this is not an Edelman problem, it is a PR problem. Wonder if anyone will go on the record with ideas of how to solve this?
ReplyI first started working in China PR during the 90s, and every agency was complicit in unethical practices (bribes, pay for play, transportation fees), even the global firms, although to a much lesser extent.
Agencies all live in this glasshouse so there won’t be much schadenfreude over this.
Ideal outcome would be a reset of common practices in China’s PR industry, so that MNCs and local agencies all compete on a level playing field.
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