APCO Worldwide

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This article is part of the Tobacco portal on Sourcewatch funded from 2006 - 2009 by the American Legacy Foundation.

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This article is part of the Center for Media & Democracy's spotlight on front groups and corporate spin.

APCO and its later manifestations, APCO Associates, then APCO & Associates and APCO Worldwide have been through many changes in ownership and control since it was founded in 1984 by the law firm Arnold & Porter. One of the public relations company's main clients was itself: it is difficult to believe much of the company's claims and historical propaganda.

  1. It began life as the real-estate holding company for the partners of Arnold & Porter law firm which serviced Philip Morris at a board-room level. It was then known as A&P Co. and it was the brian-child of real estate partner Myron 'Mike' Curzan. It was run initially by one of the legal partners of the firm, Robert J Samors.
  2. It was converted from a shelf-company to a public relations firm for the tobacco industry with the hiring of Margery Kraus (from the "Close Up Foundation" -- her husband Steven was an A&P lawyer). It was initially known just as APCo, and later, by capitalising the last letter, as APCO. It began to provide services to tobacco companies other than Philip Morris, and then later still to companies outside the tobacco industry. The origin in Arnold & Porter were not admitted at this time (They are now included in the firm's puff pieces.)
  3. It initially serviced only Philip Morris, and then the Tobacco Institute. But later it was expanded as a general-service public relations firm (hiding its tobacco industry connections) and became APCO & Associates. Later, as it established offices outside the USA, it changed the name to APCO Worldwide.
  4. In 1991 it was said to have been 'acquired' from Arnold & Porters by the umbrella media firm Grey Communications International (GCI), which made it a subsidiary of Grey Advertising, New York's largest advertising and public relations firm with about $7 billion in revenues. This later became Grey Global.
  5. In July 1994 APCO were still using Arnold & Porter's fax number See list head EuroTASSC Prospective participants list.
ASSOCIATED ENTRIES
APCO Worldwide
APCO (Doc Index)
Arnold & Porter
Margery Kraus
Grey Communications
WPP Group   &   Martin Sorrell
CREATIONS FOR TOBACCO INDUSTRY
TASSC   &   Steven J Milloy
SEPP   &   S. Fred Singer

[1] and EuroScience Project (Brussels) [2]

  1. In September 2004 APCO was supposedly absorbed by Martin Sorrell into his WPP Group (multi-media global giant) when they swallowed up the Grey Global empire. The WPP Group had Hamish Maxwell (retired Chairman of Philip Morris) as Non-executive Chairman from 1996 to 2001.
  2. September 2004 is also given as the date in the APCO Puff piece claims, when "Margery Kraus led a management buy-out of her firm from Grey Global Group, making APCO one of the largest privately owned communications and public affairs firms in the world."
[Note If the above doesn't make sense to you, then you are not alone.]

General

Arnold & Porter was one of Washington D.C.'s largest law firms, and it was also well known as the Philip Morris board-room law firm. During the period of initial control of APCO by Philip Morris and the lawyers, it extended its role to become a general tobacco industry PR firm. It developed links to both Lorillard and RJ Reynolds Tobacco. It also developed a mythical legend about its origins, claiming that APCO was founded in 1984 by Margery Kraus who served as its first president and chief executive officer. [3] and that she built this global giant singlehandedly. On the strength of this myth she has regularly been awarded achievement-awards: from the 1997 "PR PRofessional of the year" award; the 1998 "Businesswoman of the Year" award ... (virtually annually) ... to the 2006 award of "Washington PR Woman of the Year." She also received the Matrix Award for Professional Achievement (D.C. Association for Women in Communications), in 2006.


Real Origins

Fortune Magazine in July 1987 had something to say about the origins of the company.

It comes as no surprise to find Washington public relations firms pursuing lobbying bucks; what does have some old-time noses out of joint is the flocking of local law firms in the other direction, into PR and related fields.

The most notable example: Arnold & Porter, a prestigious 230-man law firm that three years ago formed APCO Associates, a grab-bag subsidiary that provides lobbying, public relations, and a host of other services from real estate development to management consulting. Arnold & Porter set up APCO as a separate subsidiary mainly because it wanted to hire non-lawyers. The practice is allowed by the American Bar Association as long as the unchurched are not made partners or misrepresented to clients as lawyers.

APCO is the brainchild of Myron Mike Curzan , a real estate lawyer and longtime Arnold & Porter partner. The idea came to Curzan four years ago as he helped a client, the University of California at Irvine, develop faculty housing. We ended up doing it all: hiring contractors, doing the bidding, developing bond financing, and managing the project, he says. Curzan brought in nonlawyer Margery Kraus, a vice president of a nonprofit foundation. Now APCO's president, Kraus says the operation has been profitable from the beginning and has grown to a staff of 54.

We're a one-stop shop in the truest sense, says Kraus. A few months back, the Advanced Center for Technology Training, a Michigan company, came seeking lobbying help to get federal funding for its product, a work station that retrains assembly-line workers, among others. They hadn't developed a business plan, didn't know their competitors, hadn't thought through their marketing strategy, says Kraus, who told them APCO could help them with all that and do the lobbying and PR too.

[4]


APCO now has offices and is headquartered in Washington D.C. and has offices in 24 locations in North America, Europe, Asia and Africa and employs 470 people. [5] [Later claim is 600 professional staff]

"Core services include corporate, investor and internal communication, crisis management, issue management, government relations, litigation communication, media relations, coalition building, opinion research, market entry, corporate social responsibility and online communication," it states on its website. The website calls the firm a "global communication consultancy" specializing in "influencing decisionmakers and shaping public opinion by crafting compelling messages and recruiting effective allies."[6]

Helping Kazakhstan buy academic reports

In September 2008, it was revealed that the Kazakhstan government had paid John Hopkins University's Central Asia-Caucasus Institute to author three reports about the country. The arrangement was brokered through APCO Worldwide, Kazakhstan's Washington DC lobbying firm. The Kazakh government paid $52,300 for reports titled "Kazakhstan's New Middle Class" and "Parliament and Political Parties in Kazakhstan." A third report, "Kazakhstan in its Neighborhood," was "also underwritten by the government," but lobbying reports that would disclose the amount paid for it are not yet available. The reports, issued by the Central Asia-Caucasus Institute at Johns Hopkins, do not disclose the Kazakhstan funding. Institute director S. Frederick Starr said their "relationship was only with the lobbying firm and not directly with the government." He added that "the entire editorial process was 100 percent in our hands." The author of the third report, Hudson Institute fellow Richard Weitz, said, "It's an important topic so I would have written about it anyway." The Kazakhstan funding also required the Johns Hopkins Institute to sponsor "think tank discussions" on each report, "sponsored by the Central Asia-Caucasus Institute." [1]

APCO and the tobacco industry

Philip Morris hired APCO to organize the front group TASSC (The Advancement of Sound Science Coalition) in October, 1993 to help fight public health efforts to control Environmental Tobacco Smoke that occurred in the wake of the U.S. Environmental Protection Agency's ruling that secondhand tobacco smoke was a Group A human carcinogen. APCO recommended that Philip Morris form a European TASSC group to: "Preempt unilateral action against the industry." [7]

A 1993 memo written by Tom Hockaday of APCO Associates lists individuals that could be approached on behalf of Philip Morris to lend their names to pre-written, favorable-to-tobacco opinion-editorial pieces on the subject of Environmental Tobacco Smoke. One of the people APCO considered approaching was Peter Samuel, whose qualifications included the fact that he had "developed a book proposal to address unsubstantiated scares including alar, dioxin, DDT, ETS, asbestos and others." (Dioxin, the primary toxic component of Agent Orange, was found at Love Canal in Niagara Falls, New York and was the basis for evacuations at Times Beach, Missouri. Asbestos, a toxin and known carcinogen, causes the lung disease asbestosis and a cancer of the pleura called mesothelioma. DDT, a dangerous pesticide that can persist in the environment for up to 15 years, was banned in the United states in 1972.)[8]

APCO also established the Science & Environmental Policy Program (SEPP) for the tobacco industry with S. Fred Singer and Candace Crandall running a climate denial program, and establishing the Heidelberg Appeal to counter the 1992 Rio World Summit.


APCO and Tort Reform

Philip Morris also hired APCO to manage a massive national effort aimed at altering the American judicial system to be more hostile towards product liability suits ("Tort Reform"). Tort reform was an internal corporate program of Philip Morris, who led other companies into the plan. According to a 1995 Philip Morris Tort Reform Budget, the industry paid APCO Associates almost $1 million in 1995 to implement behind-the-scenes tort reform efforts. APCO's job was to create chapters of "grassroots" citizens' groups called Citizens Against Lawsuit Abuse (CALAs). The budget shows the tobacco industry alone budgeted $21.8 million to fund the tort reform effort in the single year of 1995.[2]

Ownership

In September 2004 APCO announced that it had completed a management buyout by approximately 40 senior staff from its former owner Grey Global.[9]

History

In an internal 1993 budget review document for the Philip Morris Group of companies, APCO Associates was penciled in for $500,000 as a "corporate affairs consultant." On behalf of the tobacco industry and other corporate clients, it has created a number of industry front groups, including The Advancement of Sound Science Coalition, the American Tort Reform Association, and many state and local branches of Citizens Against Lawsuit Abuse, or CALAs, which are fake grassroots groups that agitate for tort reform.

A description accompanying PM's 1993 budget review says "APCO is a tort consultant to PMMC, a consultant on animal rights issues to PMMC (G. Knox) and an ETS consultant to PM USA (E Merlo). Neal Cohen is the principal account executive on the PM Tort Project and has been in this position since at least 1988. Our tort contract with APCO currently has them assisting the PM family, national and state tort coalitions and other tort reform advocates with political, communications and grassroots strategies and related programs”.[10]

Government Interference and Manipulation

APCO specializes in helping corporations advance their goals by manipulating legislators, and drafting and advancing model legislation and regulations. Key tools A&P uses include the creation of business coalitions and fake, corporate-funded "grassroots" groups tailored to specific issues. A 1995 APCO Associates pamphlet titled "Political Support Services" states,

APCO Associates, Inc. (APCO) specializes in grassroots organizing and coalition building. We use political campaign tactics to create an environment in support of our client's legislative and regulatory goals...We utilize the most effective, up-to-date technology and campaign tactics to help you achieve your legislative and regulatory goals...APCO has built numerous national and state coalitions on a variety of issues including the environment, science, energy, trade, intellectual property, education, tort reform and health care....APCO applies tactics usually reserved for political campaigns to target audiences and recruit third-party advocates. Our staff has the political field experience and has written the direct mail, managed the telephones, crafted the television commercials and trained the grassroots volunteers. We apply these hard-learned skills and tactics to mobilize hundreds, even thousands, of constituents. Or,when just the "grasstops" are needed, we recruit just a few of a target's key friends or contributors to join us. No matter the issue, we bring together coalitions that are credible, persuasive and cost-effective.

[11]

Honors

APCO was named 2003 International Agency of the Year by The Holmes Report, a PR industry newsletter. In 2004, it was listed as one of the top PR firms by The Hill, a Washington, DC newspaper.

U.S. Government PR Contracts

According to the U.S. House Committee on Government Reform Minority Office, APCO received the following amounts per year, for federal PR contracts: [12]

  • $246,946 in 2004

International Clients

In July 2004, O'Dwyers PR Daily reported that APCO Worldwide had been hired by the Indonesian Ministry of Communication and Information on a six-month contract to promote stronger ties with the U.S. government. The Indonesia account is handled by Barry Schumacher, who told O'Dwyer's that after the Indonesian Presidential election on September 20, APCO would organise a tour of the country's leaders to Washington, D.C. [13]

"The group will talk about diplomatic ties, democratic reform and cooperation on the terror front," O'Dwyers reported.

Insight

As part of a five-year research project, through its opinion research division, Insight, APCO carried out an extensive survey on corporate social responsibility (or CSR) in 2004. The survey, which included more than 400 "opinion elites" - members of the top 10 percent of society, with regard to media consumption, civic engagement, and interest in public policy issues - in 10 countries, found that people's consumption patterns are influenced by CSR efforts. "Positive CSR information has led 72% of the respondents to purchase a company's product or services and 61% to recommend the company to others. Conversely, negative CSR news has led 60% to a boycott a company's products and services," reported PR Week. [14]

Based on its survey, APCO Insight Vice-President Chrystine Zacherau suggested that companies "shape the opinion environment" by touting their own CSR efforts, "as opposed to fearing the impact of [negative] information from external organizations. ... Communicating about CSR does have positive effects for corporations," Zacherau stressed. However, the survey also found that "91 percent of respondents found CSR more credible when verified by a third-party such as a non-governmental organization or local government." [15]

Personnel

Income and Employee Totals

O'Dwyer's PR lists APCO as earning $81,844,117 in net fees in 2006, up 11% on the previous year. It notes the firm has 470 employees. [4]

PR Week ranked APCO Worldwide as the number four PR agency in the United States in 2008 (after Edelman, Waggener Edstrom and Ruder Finn, respectively), with 2007 revenue of $57,386,800, a 16% increase from the previous year's total revenue of $49,454,766. The ranking also notes its staff total of 243 (2006 total: 229), with $236,160 in revenue per employee.[5]

Clients

According to APCO its client list includes "clients include governments, corporations, industry associations and non-profit organizations. APCO also includes among its clients six of the top 10 companies on Fortune's Global 500," it states. [16]

This client list includes both past and present clients and is compiled from selected clients listed on APCO's website, O'Dwyers PR Daily, Holmes Report and miscellaneous sources.

Contact Information

APCO Worldwide
700 12th St. N.W., Suite 800
Washington, DC 20005
Phone: (202) 778-1000
Fax: (202)-466-6002
Email: information AT apcoworldwide.com
Web: http://www.apcoworldwide.com/

References

  1. ↑ Emma Schwartz, "Kazakhstan Pays for Academic Reports: Johns Hopkins Institute Says It Had Complete Independence," ABC News, September 29, 2008.
  2. ↑ Covington & Burling Tort Reform Project Budget, Budget, October 3, 1995, Bates No. 2047648299/8307
  3. ↑ Press release, "Former Starbucks Corporate Responsibility Executive Joins APCO," APCO Worldwide via CSRwire, August 13, 2008.
  4. ↑ "2006 Worldwide Fees of independent Firms With Major U.S. Operations", accessed June 2007.
  5. ↑ "2008 Agency Rankings," PR Week, 28 April 2008.

SourceWatch Resources

External links

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