Dissecting the Anatomy of Two Corporate Apologies

Facebook’s apology has not been well-received, possibly because consumers have seen it before, according to Batten School professor Gabrielle Adams.

Falling on the proverbial sword is sometimes easier said than done.

Just ask Facebook CEO Mark Zuckerberg and Starbucks CEO Kevin Johnson, who have both issued corporate apologies in recent days.

Zuckerberg was apologizing for a data breach that affected 87 million Facebook users. Johnson was saying he was sorry for the treatment of two black customers at a Starbucks in Philadelphia.

By and large, Zuckerberg’s apology was deemed insincere. Johnson’s received praise.

So what gives?

UVA Today posed that question to Gabrielle Adams, a professor in the University of Virginia’s Frank Batten School of Leadership and Public Policy, who has done extensive research on corporate apologies.

Q. According to your research, what makes for a good apology?

A. Leanne Ten Brinke of the University of Denver and I found that what matters, in addition to what you say, is how you say it. So one of the things we did was look at the non-verbal emotional expressions.

It turns out that some CEOs apologize and they’re actually expressing something we call “positive affect.” They actually look happy in their videos – like they’re trying to convey confidence or that sort of thing. Potential investors react really poorly to that. What it actually does is it results in negative stock market returns.

So when you have a CEO who gets up and looks appropriately remorseful and sad, then you see sort of an increase in the stock price of the company. People take those cues as a signal of sincerity.

Q. What are some other factors?

A. Karina Schumann at the University of Pittsburgh has looked at the eight components of an apology, such as expressing remorse, offering compensation and promising not to do it again, and accepting responsibility.

Our research shows that CEOs have more of an impact on investor confidence than other company representatives – so we coded for whether the apology came from a CEO vs. a non-CEO. That makes a big difference. People listen much more when it’s the CEO apologizing.

Q. So Zuckerberg gets some credit there?

A. Yes, but the thing that’s interesting about Zuckerberg is his long history of these privacy violations. His apologies sort of read like a broken record – “I’m sorry, we messed up.” He also sometimes becomes defensive, so he’ll say things like, “We didn’t know, we didn’t mean for this to happen and we promise to do better in the future.”

But after a while, his apologies could become meaningless if Facebook does keep messing up the privacy front. And when you apologize for the same transgression time and time again, people think that you’re not being sincere.

Q. So should he have looked at previous apologies and tried to do something different, if you had been advising him?

A. As part of the apology, there probably needs to be some offer of repair – an attempt to make it right. Not necessarily a financial compensation, but Facebook really needs to go above and beyond to show that they actually care about this and are taking this seriously.

They’ve taken some steps. I think the public will determine if those steps are enough.

Q. What was your take on Kevin Johnson’s apology?

A. He apologized in at least two significant ways. The first is by filming a video that was posted on the Starbucks website. The second is by writing a response.

In both of these, he announced he was going to close all 8,000 company-owned stores across the U.S. on May 29 for unconscious bias training. He has accepted responsibility and promised to try and make things better.

I think the thing that’s notable about the Starbucks case is Kevin Johnson is saying this incident flies in the face of their espoused value of inclusion. For Starbucks to take concrete steps and acknowledge that there is currently a national conversation going on about this and say, “We want to be on the right side of history” is a start.

Q. So did Starbucks apologize the way you should and Facebook not so much? Or is that oversimplifying?

A. I think it’s hard to compare two apologies when the transgressions are so different. Facebook’s response is also driven by the fact that Zuckerberg has been called to testify before Congress.

Both of these transgressions are part of two important conversations taking place on a national level: one about racism and the other about privacy. What’s important to keep in mind is that apologies typically need to be accompanied by steps to actually make wrongs right. Employee training for Starbucks and user notifications for Facebook are concrete steps, but ultimately, the public will have the final say about whether those steps are enough.

Photo at top published under Creative Commons.

Media Contact

Whitelaw Reid

University News Associate Office of University Communications