Hyperbole, honesty and lessons from the Elizabeth Holmes case
It’s usually preferable to start the year with an optimistic, upbeat piece.
But the talk and media focus this Tuesday morning was on the verdicts in the case against former Silicon Valley entrepreneur Elizabeth Holmes and her convictions on fraud charges. While an extreme and ultimately proven example of deliberately misleading investors about the prospects for a business’s future success, the story doubtless raised some chastening points for tech entrepreneurs as well as for leaders targeting ESG goals as they pivot firms.
The reality is that any business working to deliver nascent technology or transform rapidly has the challenge of demonstrating its potential ahead of it becoming real, something that is only made harder by such innovations being difficult to grasp, or impossible for the naked eye to see, or only communicable through concept drawings, animations and the like.
Equally, the culture of investment, innovation and corporate life cycles in Silicon Valley in particular has long seen communication being subject to hyperbole, to the point where ‘the story’ risks being too far ahead of reality, or indeed wholly disconnected from it.
As companies are challenged to set clear ESG targets and demonstrate progress against them transparently and accurately, there will always be market pressure to prove their credentials in the most compelling ways possible.
But the trial of Holmes, the founder of blood testing start-up Theranos, is a stark reminder that honesty must be upheld at all times. As Fortune put it some weeks before the verdicts were delivered, “The frightening truth? We’re all often tempted to veer from the truth in the heat of the moment.” An opinion piece in The Guardian questioned whether the public reaction to the case had been overly spiteful and disproportionate, concluding that “Holmes is carrying the can for a lot of unpublished hubris.”
And as CNBC put it, the trial offers lessons for investors too: “Theranos isn’t the only bad apple out there; it’s just the most recent example of one.”
There will always be many shades of grey in determining how best to communicate the future potential of a business, and many of them will cut across the ESG agenda and existing targets set. But the clear reminder here is that when push comes to shove, painting the most positive picture possible must never dip into dishonesty.
The ESG News Review is written by Steve Earl, a Partner at BOLDT.
If you found this story interesting you might also like this PRmoment Podcast on "Does PR have an ethics problem?"
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