A Scholar of Scandal feat. Professor Anastasiya Zavyalova

[00:00] Maya: They say all you have in business is your reputation. But in today's rapidly evolving world, with social media lending everyone a microphone, who truly controls it?

Welcome to Owl Have You Know, a podcast from Rice Business. I'm your host, Maya Pomroy.

This episode is part of our Up Next Series, where faculty and alumni weigh in on the trends currently shaping the world of business.

On Monday, October 24th, we hosted our first live podcast in the Jones School of Business. We spoke with Rice Business Associate Professor of Strategic Management, Anastasiya Zavyalova, an expert in business ethics and reputation management, and also what happens when organizations mess those things up. During this conversation, we're going to dive into our research on reputation management and the role of social media and how that relates to the Russia-Ukraine War. We'll also talk to the professor about our hopes for the future.

Thank you so much for being here with us today. So, Professor, let's start at the beginning. Let's talk about your background, your upbringing, what sparked your interest in this space, and how you became a scholar of scandal.

[01:13] Anastasiya: Well, it's very difficult to construct your life retrospectively, like, it totally makes sense, this is what led me to today, right? But I've tried to do this. And one thing that interested me early on was detective stories. So, I read novels, Agatha Christie. So, I think a part of me thinks that, if I were to have another career, it probably would be like an investigator or detective or, maybe, journalist. But I try to, kind of, compile things like solve mysteries, so to speak.

Another, kind of, defining moment, I think, in my life was when Soviet Union collapsed and my family and my grandfather, in particular, lost all of his life savings overnight, pretty much. So, whatever he's been saving all his life was worth, like, a loaf of bread next day, which made me think about... I mean, back then I was still little, but it's something that stayed with me, and that's something that influenced my choices later down the road in terms of where I'm going to go and what I'm going to study. And that was, broadly speaking, I thought that I'm going to study business ethics. It turned into, kind of, unethical or illegal or negative business practices and how they affect reputation of organizations. So, that was the beginning of it.

[02:18] Maya: And so, I read that one of the key instances when you really got interested in it was the Mattel lead toy scandal. So, I don't know if any of you remember that, but that was when everybody recognized that there was all this lead in the paint of all these toys that children were putting in their mouths. And that was really what sparked your interest, correct?

[02:41] Anastasiya: So, the toy recalls was happening in 2007, and that's when I started my graduate school. I knew I was interested in something unethical that businesses are doing. And this was all over the news, right? So, like, children dying or their magnets falling off the toys, there's something that's happening that no one knows what's going on. And then, it turns out that it's the Chinese suppliers. And there was a whole, kind of, blaming game started happening in the media about who's responsible for all of this.

And this was constantly in the news. So, as I was studying and I just started my PhD in my education in higher ed, I was meeting with my advisor on a regular basis. And so, she was, kind of, asking, like, "Okay, well go read more and more of these articles and these articles." And it, kind of, coalesced. So, because this was happening in the news while I was reading, what are the frameworks, what are the concepts in negative events, unethical business practices, that's how it came to, okay, let's study this in the toy industry, in the product recall industry. And that's how it... Well, Mattel was one of the companies in our sample, but yes, that was a big part of it because it's one of the largest companies.

[03:41] Maya: And it also impacted the entire toy industry because everybody, sort of, got lumped in with Mattel, right? And so, you also... I guess your research was also with, how does Hasbro respond to something like this? How do the other toy companies respond to something like this? And so, what did your research show that is the best way to respond if you are in that industry and there's a crisis or a scandal that's happening?

[04:04] Anastasiya: Well actually... so, you are right. If you are like Mattel, a prominent company in your industry, chances are that you will be blamed for a lot of things. So, this is, kind of, a double-edged prominence, right? On one hand, you want to be known because it boosts your reputation. On the other hand, if something goes wrong, you will also be blamed for it.

So, in that study, what we were looking at is who is guilty, for certain things, right? In this case, product recalls. So, if the industry is guilty but you are innocent, what we found is it’s better for your organization to engage as what we called ceremonial actions, or think of symbolic actions, like you're trying to have a celebrity endorse your company or your product — maybe, you have some kind of promotion, sweepstakes — so, something that deflects attention over your stakeholders from the wrongdoing inside your industry.

But if your company is responsible for that wrongdoing — so, if you are that Mattel that actually did have lead in paint in toys — it's better to engage in what we call technical actions. Think about it as substantive responses, right? So, your stakeholders will hold you accountable for, "Okay, tell me what you've done. Did you fire the managers who are responsible for it? Are you still working with those suppliers who are responsible for it?" And so, that's what we found that, if your company was involved in it, it's better to take direct and substantive actions to address the problem.

[05:15] Maya: And that also happened in 2007 before social media.

[05:19] Anastasiya: That's correct.

[05:20] Maya: Right?

[05:21] Anastasiya: Nowadays, yes, with social media, so many things can go very differently than what you plan or how they should have gone in the social media era, yeah.

[05:31] Maya: And that's part of reputation management with brands. So, today, it seems that, on social media, there's quite a bit of negative response, you know, from, if something goes wrong or sour, or there's a crisis, and then everybody's talking about it on social media and it seems that it's more negative than positive, and it also seems to me that all brands now need a designated person to be in charge of their reputation management because of something like the rise of social media. Can you talk a little bit about that?

[06:02] Anastasiya: Yes. So, in terms of more negative than positive, so one thing that researchers are finding is that, if you are salient, right, like if you are prominent, if you are vocal on social media, chances are you'll polarize stakeholders, right? So, if you're trying to take a stance on a social issue, let's say it's abortion in Texas, for instance, right, if you are the CEO of a company and you want to try to make a stance, publicly stating something about where you as a person, and it trickles down to, like, you as a CEO of a company, where you stand on that issue, chances are you'll polarize your stakeholders. I think that's an important thing that we are learning now, that we have more and more data about how social media affects reputations. You will have advocates for your brand or for your organization, but you also will have opponents.

Companies are learning, some the hard way. Some are okay with that. It seems like private companies are more vocal about it than public, just because there's, you know, one fewer stakeholder group to respond to, which is investors. So, they have more liberty, I guess, in terms of taking those stances.

Another thing to mention about, kind of, negativity on social media is country-level differences. So, U.S., to me, seems a much more positive country and culture. People love... So, when I teach certain concepts in my class, like, I come from a positive angle, like, "Look at these success stories. Like, this is what you should do and this is how they tackled it and this is how they came out of crisis." I think if I were, for instance, teaching this in Russia or another less positive culture, so to speak, things will be like, "Well, what did they do wrong? Tell me how, which I should not do."

And I think that's a part of it, is that there are certain cultural differences. And some of our researchers actually here at Rice are doing it. So, one of the marketing professors, when they were looking on TripAdvisor and how people from different countries rate the same exact hotels, right, so, they're looking at TripAdvisor reviews and it's exact hotel, exact date. I mean, you know the quality was the same exact quality, right, that they received?

[07:53] Maya: Yeah.

[07:54] Anastasiya: But people from different countries who stayed at that hotel had very different reviews about that hotel. And that partly speaks to, kind of, negativity or, I don't know, I don't want to use that negative term, we're in the United States, but, kind of, differences in culture, right, and the expectations that stakeholders have. So, that negativity can also vary, depending on who is the stakeholder, where they come from.

[08:14] Maya: So, do you believe that social media, the negative review... I mean, because in our country, you have Yelp, you have all of these different ways to review brands and place, you know, hotels and everything else; whereas, in other countries, it's not, maybe, as prominent?

[08:28] Anastasiya: Many countries use reviews.

[08:32] Maya: But so many negative reviews in other countries, or is the U.S. just, sort of, in a class by itself?

[08:37] Anastasiya: So, it's not a negativity root. It's, kind of, people, what do you expect? Like, for some... in some countries, 3.5, that's... you know, it's a good rating. But for, you know, in the United States, anything more... less than 4.7, for instance, seems to be like that's a low rating. So, I think that's where I'm getting at, is that there are differences even in expectations of stakeholders in different countries.

[08:58] Maya: Right. So, let's talk about who does it right and who does it wrong. So, you know, there are some organizations that have managed crisis and scandal well and also use social media as their platform to elevate themselves. Do you have any examples that we could relate to of who to be like and who not to be like?

[09:21] Anastasiya: Wow, the who to be like is the difficult one because I tend to, at least in my classes, focus on, like, look at all these things that went wrong. And in fact, actually that's what makes it a crisis, right? Like, how you mismanaged what could have been just an instance or an incident, but turned out and escalated into a crisis. I think that's the difficult part, because the well-managed crisis we don't know about, right? This, kind of, like, you know, like a drunk person trying to find the keys, like, and looking under the light, you know. Like, why are you looking for them here if you lost them over there? Like, but that's where the light is shining.

That's the same partly with, like, scholars of scandals and misconduct. We look where the data are, but frequently the data on misconduct and scandals are, like, these are the revealed misconduct cases, right? Anything that was hidden we don't know about, and that's more difficult to study. So, to your question, Maya, about, like, when these scandal or crisis events were managed well, the well-managed ones no one even knows about, right? Like, they just... they're all handled within the organization. Maybe, you know, handled well and no one knows about it. So, I can talk about like the... some of them that, kind of, were mismanaged or —

[10:26] Maya: Sure.

[10:26] Anastasiya: — or instances where... So, one of the cases that I'm... actually, this is going to be the first one I'll be teaching in my MBA class is United Airlines. You guys probably remember how Dr. Dao was dragged down the aisle in the airplane and what happened afterwards. Arguably, this could be considered an incident, right? From the reputation management standpoint, it wasn't even the employees of the company that were involved in it. This was airport security that was doing this. And this is a great example of when you can actually, kind of, be transparent and say, “Horrible thing that happened to the passenger, the airport security, handled it not in the way that, you know, were inconsistent with the values of United,” for instance. Instead, what happened was, like, the classic example of how things can be mismanaged internally and externally. So, internally, the letter was disseminated among United employees that this was a belligerent customer, that that's what leaked out on social media. That's how they were addressing Dr. Dao, that this is a belligerent customer. Externally, it was said that, "We apologize for reallocating one of our passengers." And that's the term that started kind of... It became viral on social media. It's like, what do you mean reallocating? He was bleeding like that.

[11:35] Maya: And dragged with his arms above his head –

[11:36] Anastasiya: Exactly. And screaming, and people were in, like, in shock that this is happening. So, this is one of the examples that it could have been an incident if managed well and handled well. In fact, another interesting point is that the CEO of United back then, the year before, received an award for PR. And it wasn't quite reputation management, but he was like a great public relations person. And then, this hits.

So, kind of, another tangential point to that is that, if you raise people's expectations about what kind of company you are, once this, kind of, the push comes to shove and you are tested and you do this, this is like a classic case of mismanagement. But with the caveat, like, all of this with social media is getting so quick now, you don't have the luxury of, you know, Exxon Valdez in 19... when was it, '70 or '80s, where like you had a week to figure out, "Okay, let's do this. We'll say that. We'll use this newspaper to publish." Like, you don't have that luxury of time anymore. Things are, like, changing every second. So, with that caveat that there's a lot more pressure in general on CEOs of companies to handle it quickly. And so, that was the case where it was mismanaged, I would say.

[12:42] Maya: Well, and also it’s something that we have now that we didn't have in the '70s and '80s and, you know, before are these little things where you can take video of everything that's happening and then you can live stream it and you can post it on TikTok and you can post it on... I mean, other than Twitter, you can really post video of everything that's happening, which we can segue into, in a little bit, about the war between Russia and Ukraine and how everybody can really be a war correspondent these days and post what's happening in real time. And so, that is also part of that social media where it's not just words, it's actual video. And that kind of content is very powerful to see and to understand. And you can't refute that, you know. That's one of the things that I remember about the United Airlines scandal, because it was a crisis and it turned into a scandal. And I'd like to talk to you also about, you know, the difference between a crisis and a scandal, right? So, if you can manage a crisis, it doesn't turn into a scandal.

[13:36] Anastasiya: That's right, yeah. So, my gosh, I don't know where to start. So, in terms of social media, right, and how it changed the landscape of reputation management, so, a couple of things. I know I mentioned, kind of, the cycle of this, because now you don't have the luxury like I said, I mean you have to make decisions pretty quickly. You have to be on point.

Another thing that made the change is it's interactive now. So, to your point about, like, using phones, right? So, it's no longer that stakeholders are recipients of information, but they contribute to the reputation of the organization.

[14:05] Maya: They're content creators.

[14:06] Anastasiya: They are content creators. And they are not necessary... not only brand ambassadors anymore, right?

Like, they could be the complete opposite. And they may not even ever interact with your company directly. Maybe, you know, you never even flew United. But now that you see these images, very, kind of, visceral emotion, you know, the bleeding passenger that you're dragging, right? You're right, like, you cannot refute it. And so, that kind of interactivity between stakeholders and companies has contributed greatly, I think, to the changes in reputation management.

And the last one is the level of transparency, where, more than ever, I think now, the consistency between your internal and external messages has become important. Because if you mis- or if you communicate differently a different message to your internal stakeholders and then you say something differently for reputation management purpose to your external stakeholders, it's going to come about. Whistle-blowing will be an extreme example of that, but that can come about, right? So, your Facebook, you're using algorithms not to the best goals of your customers, right? And it's going to be, you know, something else is driving your decision-making that can come about quickly. And so, that inconsistency in message is something that has changed, kind of, the social media landscape for sure, too.

[15:20] Maya: And also, there's pressure with organizations and businesses to take a stance on socially significant issues.

[15:25] Anastasiya: Yes.

[15:26] Maya: Certainly, right now, I think we all know what those are, especially in the state of Texas. Has that always been an issue, or do you think that's something that has started because of social media? Or, you can literally put up an Instagram account, you know, sort of, pushing your messaging of what organizations or what people need to believe and think and everything else?

[15:46] Anastasiya: So, I would actually invite our audience to look at something that I like, the study by Pew Research Center. You probably have already looked at it. But they look at polarization of U.S. audiences or U.S. general public from 1994. I think most recent data they have is like 2019 or '20, like very recent. So, definitely, post-social media era. And what they show is that the society, at least in the United States, is becoming more polarized. So, if the... And they're looking specifically at the Republican, Democrat, or liberal and conservative values that people uphold. And you can see, kind of, the distribution of this is liberal, this is conservative, the means were very close to each other. Yes, people were on different sides, but they were closer to, kind of, the average level of distribution.

As the years go by, and you can actually click on, kind of, the animation of it, it's really telling to me how it gets polarized. And so, all of a sudden, we see this switch. So, now it's, kind of, this is the liberal side, this is the conservative side. So, polarization is occurring at that level. But we are also seeing it with companies as well. And there is pressure, for sure, especially for B2C companies. So, if you are, kind of, a, you know, consumer-facing brand to take a stance on issues that are important to the constituents.

Yes, it can lead to polarization, for sure. In fact, I have some students, when I teach this in my class, they will come up to me and say, like, "I don't care where they stand. I just want to have a good salary and good working relationships with my colleagues, and that's it," right? But some companies and some companies' CEOs feel that pressure and feel that they have to respond to that pressure.

This is not to say that everyone is doing it. In fact, some CEOs think like this is not... not necessarily that it's not their place because they are very powerful, but they choose to be reticent. That's their actual strategic decision. "We are going to stay out of the spotlight. We're going to be reticent. We are in the business." Like, Michael Jordan said, like, "Republicans buy sneakers, too." So, there we go. So, you know, "This is my business, and it's not my business to talk about, you know, the polarization of society." And some don't make those stances.

There's a complete extreme to it, where some companies do it and do it in a way that is not consistent, to say the least. So, for instance, one of the examples I use in the class is BMW. During the LGBTQ month, they use, kind of rainbow on their brands, on their brand on the logo, but only in certain countries in the world and not others. So, kind of, like Muslim and more conservative countries, they don't do that. And so, this is, you know, a skeptical person will say, "Wow, that's a cheap way to, kind of, say that’s where you stand, except you really don't. If you really truly believe that this is an issue that's worth taking a stance on, you'll do it across different countries." So, there's, kind of, pros and cons to that, but there is definitely more and more pressure from stakeholders from these companies or onto these companies to take a stance on issues that are important to them.

[18:37] Maya: And BMW doesn't think that those stakeholders or those customers are going to see that? I'm just curious because [crosstalk 00:18:41].

[18:42] Anastasiya: I don't know. So, I shouldn't have said it because I was going to take a poll with my students. I like to do that with my students. But, yeah, I don't know how many of you guys actually go online and look up, oh, let's see how they, like, position their brand in Saudi Arabia, for instance.

[18:55] Maya: Right.

[18:55] Anastasiya: I don't know how many stakeholders do that. Some of us just look, "Oh, look, this is what their brand looks like in the United States, and that's enough information for me."

[19:02] Maya: With that, I want to switch over to what you also discussed and what you studied in terms of scandals within universities and giving by alumni. And so, one of the things that was part of your research was that, if there's a scandal in a university, there are stakeholders that are like the die-hard alumni that are going to give. And they actually give more during a scandal up until a point. Can you talk a little bit about that? Because I found that fascinating.

[19:28] Anastasiya: So, this actually speaks to that polarization idea, right? So, once you take a stance, you will polarize stakeholders. Some will be your advocates, and some will be, kind of, the opponents of your organization. So, in that study, I was looking at alumni versus non-alumni. So, not quite opponents, right? But people who are not... who don't have the same involved level of relationship with the institution. And so, yes, we were looking at NCAA infractions by football teams, or athletic teams, in general, in the U.S. universities. So, things like creating fake classes to recruit student-athletes and then boost their GPA. So, I'm not going to name a school. You probably all know which school I'm talking about. Penn State was, like, an extreme example in that, you know, there's the big scandal.

[20:08] Maya: [crosstalk 00:20:09].

[20:11] Anastasiya: And I use that as, kind of, an illustration that, when negative information about misconduct in an organization just starts trickling down, those stakeholders that were your advocates are going to stand by you. They're, kind of, the loyal customers or loyal investors, loyal alumni, donors, right? They're going to be the ones who will, kind of, advocate for your brand. They will be giving you the benefit of the doubt. They will be saying that, "No, hold on. We don't have a lot of information yet. We don't know what happened," up until a certain point. When there is a lot more clarity, a lot more facts start coming about, and that's where, kind of, the mismanagement occurs, right? Like, if it's revealed that you've been covering it up all along, you're, kind of, risking to lose those advocate stakeholders.

And that's the worst you can do for your company is lose those because chances are they're not going to easily come back and be like, "All right, I'm going to support Penn State again," you know. It's, to go from negative to positive is very difficult, to go from positive to negative, quick and easy. So, yes, this is why it's important to build those positive stakeholder relationships, to build the loyalty of stakeholders for your company, for your organization, for your brand, because they are the ones who will be supporting you in light of a crisis.

[21:19] Maya: However, in some of the examples were, the alumni said, you know, "I don't really care what the scandal is as long as they keep on winning... so, as long as they keep on winning games, then I'm..." which is, which also brings me back, and I'm sorry this might ruffle a couple of feathers, but about the Astros and the whole cheating thing that happened, that people try not to remember about what happened with the Astros a couple of years ago. But people tend to have a very short memory, right? Like, that's just something that people don't... Or, like spying on the calls and all this whatever. Like, I'm not a baseball fan, so I don't know.

[21:55] Anastasiya: Why did you bring up Astros then?

[21:56] Maya: But everybody remembers, but you guys remember when that happened?

[21:59] Anastasiya: Yeah, I actually had students write a case on this, too, yeah.

[22:02] Maya: Okay. So, talk to me about the memory span of people remembering scandals or choosing to forget.

[22:09] Anastasiya: Ah, yes.

[22:10] Maya: Or, also, there are folks that weren't even alive during Exxon Valdez and when all of that happened. And people tend to have a short attention span with those sorts of things. And even like the, you know, New Horizon, that whole tragedy that happened and the scandal that followed that.

[22:27] Anastasiya: Okay. So, a couple of things on that. One is the athletic scandals were a unique type of crisis.

[22:34] Maya: Like Deflategate as well with the Patriots as well.

[22:37] Anastasiya: Yes, yes. So, that memory and the severity of consequences depend on the type of crisis we're talking about. So, what you're mentioning, Maya, that happened when I was asking people, like, "Hey, why did you stop it?" Or, like, "Why did you continue donating?" Like, "I don't care how they recruit. I don't know. I don't care if they have escorts at the recruiting event. Like, they're winning. That's good, right?" But is it real... So, in the view of these stakeholders, this was not a big crisis or a scandal or some kind of egregious violation that is worth breaking ties and not being loyal to the team anymore.

But think of a different type of crisis where this actually can matter a lot. So, another context that I studied, with the tremendous help of some of the people in the audience, was Catholic Church child molestation scandal. It is still an unpublished study. It's been so many years that I've been working on it. And I, like, so was entrenched in the context. But I was looking at how parishioners reacted to the scandal of child molestation in Philadelphia Archdiocese. And that's a different type of crisis, right? It's a different type of misconduct and violation. It's a different type of context altogether. So, all of a sudden, the victims are not, you know, 17-year-old boys who were recruited by having escorts, like mingling around in a recruiting event. The type of victims and the severity of the crisis mattered in that case, to the point where even the loyal parishioners, the loyal Catholics, were like, "Okay, I am done." They said that not only are they going to not going to go to that parish anymore, they're just going to... some of them actually switched to other denominations altogether.

So, the type of crisis matters. In terms of memory span, it was a revelation for me. So, I was teaching strategy class. It wasn't even a reputation management class, but strategy class for undergrads at Rice a couple of... well, many years ago now. It feels like a couple of years ago. And I asked them. So, they have a final project usually. And I asked them, kind of, "Hey, guys, like, which team or which company do you want to write your final project on?" And many of them say Nike. And it kind of stuck with me because I remember when Nike had a child labor scandal in the '90s, right? Like, they used child labor in their workshops. And that was a big thing, big taint on their reputation. And when I mentioned it to the students, they're like, "Oh, I've never heard of that." You know, the year... the age difference was maybe 10. I had 10 years on them, but they didn't even remember that. So, that didn't stick in their memory. So, that was kind of revealing to me. I'm like, I wonder how long that social memory lasts, collective memory, right?

I think, with social media, there are, kind of, two dynamics going in different directions. So, on one hand, yes, our attention span becomes shorter. Like, what happened yesterday we forget because there's so many more shiny and bright things happening right now. Like, you want to be constantly on point. Like, you know, you have to do so much more to just catch up. So, that's one thing that attention span may be shorter. But on the other hand, with social media, things... like, everything you've posted stays with you forever on the web.

[25:24] Maya: Well, you can delete it. But yes, it does, kind of, you can screenshot it.

[25:27] Anastasiya: Yes, exactly, people screenshot. And so, when your company's going through a crisis, those things that you've posted years ago can actually be brought up into light yet again. And so, that's, kind of, the, you know, the dual dynamic. So, yeah, on one hand people stop paying attention to your crisis because there's something new happening. But on the other hand, if they are starting to dig deeper, the social media is actually allowing them to, kind of, conduct that, you know, digital ethnography and see, well, what kind of person are you? Like, what did you say 10 years ago?

[25:55] Maya: Right.

[25:55] Anastasiya: What kind of Halloween costume did you wear in 1970s?

[25:59] Maya: Well, that's what you tell your children. Like, whatever you do, it will be on there forever. It will be on social media forever. So, let's switch gears a little bit about and talk about the Russia and Ukrainian war, and how those countries have used social media. And also, obviously, you're from a Soviet country. I am as well, full disclosure. So, both my grandparents are Ukrainian and both of us come from that neck of the woods. So, tell me about how, you know, this war is very much, it seems to be, black and white and no shades of gray. And you feel that, that's dangerous as well because there's plenty of people within Russia that aren't in support of the war in Ukraine because there is... there are so many close ties between the two countries. So, tell me more about how that's dangerous to classify it that way.

[26:50] Anastasiya: So, one thing I would say, yeah, these are really like switching gears in the conversation. The war itself was a shock for people in Russia. It was a shock for me. In retrospect, there were so many different red flags that, kind of, pointed to now that we are, kind of, you know, going through it, digital ethnography, including, it's like, of course, they would've done it. Like, look at what Putin published in 2015 and so on. So, that's... it was still a shock, even though... Regardless of how much information we had on our hands, it was a big shock. When it started, I was on sabbatical at Oxford. I mean, some of you guys read that in the Rice Business. So, I was in the middle of the research project that I was studying, and then this happens and it was a big shock. Yeah, I think every Russian family is split in a way. So, within each family, there are people who support and oppose the war, really. I mean, this is... it's that polarizing.

But also, what happened, I rarely post on these types of issues on social media, but something happened which, kind of, made me want to say something about it on LinkedIn, specifically. But I saw how quickly people started saying war of Russians or war by Russians against Ukrainians. And that, kind of struck me because, like, I'm ethnically Russian. I've been opposing this regime, probably not as adamantly as I should have, but I have been a part of the protest. I was walking in Russia when Navalny was put to jail. So, it hurt in a way that people kind of thought that all Russians are bad, right?

[28:18] Maya: Just like in the Cold War where—

[28:19] Anastasiya: Yes.

[28:20] Maya: … because I came here during that time. And when I was growing up here in the States, I was called all sorts of names, and a communist in this and everything else.

[28:27] Anastasiya: Yeah, the Red Scare, right? Like, you are the communist, and all of a sudden, like you...

[28:30] Maya: Well, it's happening to my children now in school.

[28:32] Anastasiya: There we go, exactly.

[28:33] Maya: Because they're half-Russian. So, I know exactly what you're talking about.

[28:37] Anastasiya: Right. And so, my... that post that I made kind of... I don't know, maybe that wasn't the right time to do it. To me, it felt like, okay, if I am ever vocal, this is what I'm going to say. Because I think I know something about, kind of, research on stigmatization or negativity and how it can be dangerous and think in categories. And that event that was happening right there and then. And I saw the lessons from my research, kind of, playing out live as I was, kind of, reading the news, that I felt like, okay, I need to say something. And that's, kind of, that danger of how quickly people started stigmatizing the entire, kind of, Russian nationality, even though there were like I said, people in Russia who were strongly opposing the regime.

That project that I mentioned a bit earlier was about NGOs in Russia who were actually fighting against what was happening in Russia for years, for decades, right? So, that's something that was very emotional to me, that, yeah, quickly, it was a category of like Russians. And now, everything that is Russian, all, like, you know, it's a Red Scare all over again. And that's something that I really hope that people won't do, to the extent that it was done that early in the war, and that I lived through, as probably many of you guys have, that danger of being classified into a category, without anyone knowing anything about, kind of, exactly who you are as a person.

[29:54] Maya: Right.

[29:58] Anastasiya: I think that's the dangerous path to travel.

[30:00] Maya: Absolutely. And it definitely damages your reputation. If you're an organization and you take that stance, or even if you're a human being and you take that stance. So, what are your hopes for Russia and Ukraine in the next few years? And in what areas do you see progress?

[30:15] Anastasiya: As anyone, I hope for this war to be over. Like, that's the first hope. My speculation is, you know, if I were to be true to, kind of, the research that I've conducted and my colleagues have conducted, my prognosis for Russia is that it's going to take years, if not decades, to recover from it. Because as the war was unfolding, I think one thing that Putin's regime did not expect is that how many more companies and countries are going to turn away from them. I think, in a way, the bet was this is going to be over soon, quickly, and just much like, you know, the war in Crimea. And it didn't. I think that was a wrongly placed bet. So, all of a sudden, multinational companies started leaving Russia.

[30:55] Maya: Exxon with $4 billion worth of assets still on the Sakhalin Island.

[30:58] Anastasiya: Exactly. They're like, yeah, done, this is a toxic asset now for me, right? I'm not going to do business with your country. And so, I can't imagine that those same executives or companies that turned away will change their mind pretty quickly, right? So, if I were to live like I said by my research, I would say that, no. To recover from negativity to start building up your reputation again, that is now going to take years to do, if not decades. And that's the... If I were to forecast, I think that's what's going to happen. Even if there is a change in regime, I think it's going to still take years to recover. And in terms of relationship between Ukraine and Russia, that's a whole other story because this is... there are homes that are being invaded. It's people who are being displaced. Crazily, many of them are relatives of Russians, right? And it's, yeah, it's going to take a long time to recover from this.

[31:47] Maya: Yeah, that reputation management is going to take decades.

[31:50] Anastasiya: And it's not just... I think, like, reputation management in this context feels too superfluous. And that's not what we mean, right? Like, it's more, kind of relationship management or restoring the trust. That's going to take a long time.

[32:02] Maya: Yes. Well, thank you for your input and your perspective on that. You recently took a sabbatical, and I wanted to talk to you about what you what you worked on during that time.

[32:09] Anastasiya: Yeah. So, it was wonderful. It was my first sabbatical. I've spent enough time at Rice that I worked towards my sabbatical. So, yeah, I was at Oxford University. And one of the projects that I started working on was actually looking at stigmatization of organizations and, kind of, the early stages of stigmatization. So, a lot of stigma research looks at what happens if you are in a stigmatized category. Think of, well, some studies were conducted in, let's say, like, gambling industry or gay men's bathhouses or marijuana industry. Like, that was a stigmatized industry in the United States. And so, given that you're in a stigmatized category, what happens and how do companies manage that, right?

There's less research on where does the stigma come from in the first place? Like, who's responsible for it? Like, why does our society, all of a sudden, think that marijuana is somehow worse than alcohol, right? So, that was, kind of, the theoretical question I had in mind. But I was studying stigmatizations of NGOs in Russia. In 2012, Putin signed a law that is called Foreign Agent Registration Act. Well, it's equivalent to the Foreign Agent Registration Act in the United States. The law is foreign agent law in Russia. And according to that law, NGOs that received foreign funding — and mind you, this could be like SourceFoundation, Greenpeace, MacArthur Foundation, Elton John's foundation, and many, many, many others — if you received foreign funding and if you engaged in "political activity," which could be defined, well —

[33:41] Maya: As anything?

[33:41] Anastasiya: Yes, anything can go under that umbrella. You are entered into a foreign agent registry. And so, the question that I was studying while I was interviewing leaders of these different NGOs in Russia is how did they, kind of, fight that early stage of stigma emergence, right? Like, how did that label start becoming stigmatizing to them? What strategies they took, not necessarily to recover, but to deal with this emergence of stigma.

So, I was, while I was in Oxford, I was actually interviewing them on Zoom, and WhatsApp, and Signal and all kinds of platforms to get more insights into it, but also conducting, kind of, archival research as well.

[34:16] Maya: Right. And you have a new title as well. Can you share that with us?

[34:19] Anastasiya: Yes. Thank you. So, recently, not because of that project but just because I've been involved in this... or entrenched in this research for so long, I have been named an international research fellow with Oxford University Center for Corporate Reputation. It's been an honor. It's a great institution. I've been involved with them for 10 years. And so, that's, yeah, that's another title.

[34:40] Maya: That's incredible. And we're very lucky to have you. So, don't leave.

[34:42] Anastasiya: Thank you. Thank you.

[34:43] Maya: Stay here with us, okay? Well, thank you so much, Professor. It's been great fun to talk with you.

[34:50] Anastasiya: It's all right.

[34:50] Maya: I would like to open up the floor to questions. So, if anyone has a question, we're actually going to have a microphone that we're going to have brought up here. So, if you'd like to come up to the microphone so we can hear you, come on up.

[35:01] Audience 1: Hello.

[35:02] Maya: Hi, Marcus.

[35:03] Audience 1: Thank you so much. So, my question kind of, goes back to the very beginning of what you're talking about with, like, the Mattel scandal. So, you mentioned that even companies in the industry that aren't guilty, they would do like discounting or do like celebrity endorsements. Do you ever see that that could be an issue in itself to where consumers could see that as their, maybe that company's covering up and maybe they could be guilty? And then, how could they potentially strategize to ensure that they're not seen as a guilty party, but they're actually ensuring that their reputation isn't taken down by the guilty party?

[35:37] Anastasiya: Yes. Great question. That can backfire, in fact. So, when I kind of, bring in the studies from the past to my students, like, look, this is how these companies manage that. Like, which scenario do you think is the best? The answers differ from what the studies published 20 years ago. So, I think what this speaks to is to the fact that people are more scrutinizing of what companies are doing and companies' motivations behind their actions. So, you're right on point with that. I wonder if I were to conduct the study now, especially with social media, how things will change. But in terms of, kind of, what should we do if this happens, so, the way that I, kind of, label this is guilt by association, right? You didn't do anything wrong. Let's say we're talking about higher education industry, right? And so, we know some universities forging rankings and trying to do certain things just to boost their rankings. And then, think USC, think of Rutgers University, like there's all of this, kind of, maybe not scandals, but negativity happening. It kind of, puts scrutiny on the entire industry of higher education, right, and the role of rankings and so on.

So, I think one thing that companies can take is reaffirm what their values are and how they tackle this, right? What do they do in order to address this and signal that they're not a part of this? With the caveat that that's true, right? So, that's something that can backfire to companies is when they say one thing, but in reality, what they're doing is completely different. And that's why I think of reputation management is not necessarily, how do you manage, kind of, the message you push to your external stakeholders? No. Like, if you are truly insincerely a company that's doing something really bad and rotten from within, I probably won't be the right person to be a consultant for your company. So, if you are truly a transparent and sincere and company that lives by its values, that would be the time to kind of signal it to the stakeholders that, "Well, look in our case, no, this is not what we're doing. We know this is happening with our competitors," but try to, kind of, mention what, kind of, strategies and actions you take to ensure that this doesn't happen in your company.

[37:37] Audience 1: Perfect. Thank you so much.

[37:38] Anastasiya: You're welcome.

[37:41] Audience 2: Hi.

[37:42] Anastasiya: Hello.

[37:42] Audience 2: I want to thank you all both for this opportunity for us to be here and to hear from you. I actually had a few questions that came up while listening to you. So, depending on how many other people have questions, I'll ask all.

[37:52] Anastasiya: I'll take more offline, for sure. I'll stay here.

[37:56] Audience 2: Well, the first one that I was thinking is when a company throws a line or on an issue or a company, you know, is, kind of, waffling or wavering in between what they believe or what they want to put out to the public, how do you create clarity or buy-in within the employee base? Because the people that are working for you, they need to know what to expect as well and where they stand, especially in an inclusive or a diverse employee base. Like, how do you... And I don't know if that's in your work, but like how would an executive do that sort of work?

[38:26] Anastasiya: Yeah. I haven't studied that myself. I can speak, kind of, from the studies of my colleagues. Some decide that this is not their place at all, right? But if there is pressure from stakeholders, and you can think about stakeholders differently, but if these are, kind of, the salient stakeholders who actually have an ability to put pressure on your company, let's say we're talking about employees or investors, you will have to say where you stand. And I think, usually, and let's not talk about, kind of, things that polarize stakeholders, but usually, what makes sense in those instances is what is the common goal? Like, I want to make sure that everyone feels safe and respected in the workspace. I don't think any CEO will come out and say, "You know what? I don't care about how respect..." Well, actually, there are some CEOs who can do that, but not publicly, I guess.

[39:14] Adrienne: We can think of a few.

[39:15] Anastasiya: Yes. So, there are a certain set of common goals and values that actually, regardless of where you stand on the party line, will resonate with different stakeholders. Like, you want to make sure that all the students at Rice feel welcome, right? And I think that's the message that will resonate with everyone. So, that's how some CEOs choose to make a stance.

I know I mentioned that you know, public versus private companies could be different. And we are seeing companies like Chick-fil-A or Patagonia, right? Like, private companies trying to be, like, really vocal because they have that liberty, I guess, to do it. But I think for publicly traded companies, it's a really fine line. But even so, there are a certain collection of values which everyone can understand and agree with. And so, I think that's where you can, kind of, publicly mention that, yeah, with due respect to everyone, make sure that the environment is inclusive.

[40:02] Audience 2: That makes sense. I'm going to ask one more in case someone... unless someone else is walking up.

[40:05] Maya: Yeah, absolutely.

[40:07] Audience 2: What skills do you encourage us to take up as consumers to better assess the fidelity of a company's commitment?

[40:14] Anastasiya: Yeah, be vocal and scrutinize them. I mean, if you see that there is something that's quite a bit off, like if you learn that the company is saying something different to the employees versus the brand they're trying to put out there, you have the power.

Like, we all have the power now to scrutinize that, to see whether the company is true to its words. So, I just came out of a class where I was... we're talking about, kind of, identity versus reputation of a company. So, identity is what internal stakeholders think, “who we are as an organization.” Reputation is what external stakeholders think about the company. And if there is a mismatch, that's a good recipe for disaster.

So, the example I was giving to the students was Enron. I actually looked through Wayback Machine on their website in like 1999. And they spell out all the values that they stand by. And two that I specifically highlight was respect and integrity.

And they say, you know, "We treat others like we want to be treated. If we promise something, we'll deliver on that promise." I'm like, isn't that kind of funny to see now? Well, not funny.

[41:11] Maya: Except for your retirement account, [crosstalk 00:41:13] everything else, yeah.

[41:15] Anastasiya: Yes. So, now, kind of down the road, we're seeing, look, this is what happened. People didn't have that, not even luxury, but that tool to scrutinize what the company is doing because I think a lot more people knew what's happening internally and could have been transparent or put the company under more scrutiny to make sure that they stand by those projected values. And so, I think this is one thing to say is that, yeah, put the company on the spot. If they're not doing something that you... that they promised they will do, if they're not living by the values that they project to others, you have an ability now to say that.

[41:48] Audience 2: Yeah, that is the one great thing about media and all of the technology we have to be able to actually be intentional about finding it and then calling them out. I really appreciate you answering that, and thank you for your time today.

[41:59] Anastasiya: Thank you.

[42:00] Maya: Other questions?

[42:01] Audience 3: I also wanted to say thank you to you guys for being here. So, my question is really about how you determine where to take your research in the future and what your process is like.

[42:11] Anastasiya: Oh, wow. Interesting. Funnily enough, it usually happens when I write the discussion section of a paper because that's kind of the last thing you write. And this is where you can speculate, you know, I haven't addressed this, I haven't addressed that. So, like with the NCAA scandal, for instance, what we saw was, you know, alumni support it, and then they don't.

And so, like, this “don't” part was interesting to me, like, when is enough is enough for them. And that becomes, kind of, a new study. And that led me to the Catholic Church, like, and made me think that maybe it's the different types of crisis or scandals, right? So, yes, it's easier to forgive the fact that there was a fake class because, you know, who really were the victims versus these were nine-year-old, in some cases, children, right? So, when I write out the discussion section and all the nuances, that kind of makes me think, “Okay, this could be the next study.” Or, so this is, kind of, the theory-driven approach to thinking of what's next to study.

Or, it could be phenomenon-driven. Something is happening out there in the world that maybe current theory cannot explain. But this is really a big thing. And that's exactly what happened actually with the NGO study that I mentioned. I did not quite have... I mean, theoretically, I had the question of, I wonder where a stigma emerges. And I look at sociology study, I look at the, kind of, business strategic management studies. And usually, they start from, given that there's a stigma, this is what companies do. But the question is like, how does it come about theoretically? And then, it was, I've been following, kind of, the development of Russia while I've been in the U.S. So, that phenomenon, especially once the war started, it all, kind of, came together.

Like, my research, the current events, the context, the importance of the context. So, sometimes it comes from, kind of, the phenomenon, and that drives the question.

[43:46] Audience 3: Thank you very much.

[43:47] Anastasiya: You're welcome.

[43:48] Maya: Other questions?

[43:49] Audience 4: Do you ever get approached by organizations or people... maybe not CEOs, but people who work for them about your research?

[44:00] Anastasiya: I do, yes.

[44:02] Audience 4: And what... do they ask you to come in and give them an assessment? And have they been through scandals, or are they just asking, maybe, ahead of something that might break?

[44:16] Anastasiya: Proactive, right?

[44:17] Maya: Yeah, scandal avoidance.

[44:20] Anastasiya: Yeah. So, rarely does that happen here. I'm usually like, oh, what do we do? So, I've had a couple of companies approach me just to pick my brain, right? So, usually, it's not like, "Oh, my gosh, we're losing," because that's when they invite consultants. In fact, like one of the speakers in my class is a McKinsey consultant whose job is precisely to do that.

Like, the company's going through a crisis. I do not want that job. It's so much pressure. I love being a researcher, instead. I don't know how he handles that. But I do get approached by companies where they try to figure out, like, how do we build this brand? Or, what would be... you know this is the situation we're in. It's not necessarily a scandal or a crisis, but something that they're struggling with and trying to, kind of, conduct some internal analysis, you know. What's the best way to, kind of, go ahead with building reputation? But yeah, sometimes companies do approach just to, like, pick my brain.

[44:20] Maya: Okay. Well, we want to thank you all so much for being here today. Professor, thank you for being here today and spending time with us.

[45:15] Anastasiya: Thank you.

[45:17] Maya: We are going to have a reception in the Woodson Courtyard in just a few minutes. And you can also have some time to speak with Professor Zavyalova and ask her additional questions. And we're just so grateful for you to be here today. And we're wishing you a wonderful evening. Thank you so much.

[45:33] Anastasiya: Thank you.

[45:35] Outro: Thank you for listening. This has been Owl Have You Know, a production of Rice Business. You can find more information about our guests, hosts, and announcements on our website, business.rice.edu. Please subscribe and leave a rating wherever you find your favorite podcasts. We’d love to hear what you think. The hosts of Owl Have You Know are myself, Maya Pomroy, and Scott Gale.