IT was during the mid-'80s stock market boom that the practice of giving gifts to journalists covering share issues became institutionalised. At the beginning of the '90s, however, merchant bankers and financial advertising agencies noticed that attendance at share issue press conferences was dwindling. Enquiries revealed that the scribes now possessed so many wall clocks and wallets and tea-sets that they no longer found it worthwhile to attend these press meets. By common consensus, it was then decided to give Rs 500 gift vouchers from leading department stores so the reporters could buy what they wanted. Last year, the value of the voucher was raised to Rs 1,000. This is the average. Depending on how desperate you are to get positive media mileage, the value of the gift voucher (or gift) could go up to Rs 5,000.
In Bombay, things are very organised. There are people who even buy gift vouchers off the journalists—the equation being Rs 450 against a voucher worth Rs 500. Many of these vouchers are then bought back by the ad agencies from the touts for Rs 475. This is a system stunning in its simplicity: the scribe gets cash, the tout makes his profit, the agency recycles a gift voucher several times, while charging all its clients for new vouchers for every press conference.
"A press conference can cost up to Rs 1 lakh in a metro for a medium-sized issue (about Rs 10-15 crore). In the main cities, about 12-16 conferences have to be conducted. That's Rs 8-10 lakh in total. Yet, it's cheaper than advertising, which could cost 10-20 times of this, and a press report goes much further in getting investor support. No matter how staid, an ad always looks like propaganda," says the chief of the financial advertising division of a leading agency. "Again, advertising gets a one-time exposure," he points out. "A correspondent who is on the take is available to the agency to write for all my clients whenever needed. Senior editors are also into it. Even though the juniors write the piece, it makes sense to keep seniors happy because they can ensure the right placement of the piece and priority if space is short."
Besides straightforward gifts, a common way to ensure fourth estate loyalty is by allotting shares out-of-turn to scribes, or doling them out free. "Only one or two men in a 100 will refuse this sort of an offer," is the cynical observation of the public relations chief of a large corporation. "In one way or the other, all companies do it. Favours ranging from buying flight tickets to huge gift hampers are common." Indeed, entertaining can become an expensive affair. For, PR men too misuse company resources to dine and drink every night and charge the bills to 'journalist entertainment'.
What would happen if companies didn't give anything? "Frankly it wouldn't affect a big company. But smaller guys would suffer," says a leading PR person. But if your company's performance is good and your share issue is an attractive investment, why do you need to still pay? "Because the quid pro quo system is so ingrained that if you don't hand out gifts, many of them will write nasty press reports. And that'll hurt." Will the formal Press Council code help? "It might help, for a journalist would be made to realise that he is breaking a code for which he can be penalised."
Others, however, remain unimpressed. Says a leading adman: "I can't figure out how a code can be set up because both the parties involved—the corporate world and the pressmen—are benefiting. Why should the company squeal when it is getting a good deal?"