Allowing Advance Peeks

By Thomas Griffith

Even more than most readers, businessmen are apt to complain about stories written about them. Considering the press's "spotty record" for fairness and accuracy, New England Business magazine lamented in a recent editorial that "somewhere in the deep past, the journalistic trade decided that it was unprofessional" to show an article in advance to its principal source. Founded in 1952, New England Business (circ. 45,000) is now proudly violating that rule, though " sometimes this leads to difficult conversations." It finds businessmen grateful, but the practice is not a total guarantee of accuracy: "One company reviewed a complete story in which its own name was slightly misspelled and missed the error." The idea has a plausible sound, but it's not about to take off. It is not even a new idea. FORTUNE magazine reluctantly found it necessary to make the same commitment in its early years.

The launching of FORTUNE was proclaimed just one week before Black Thursday, the stock-market crash of 1929. (Its founder, Henry R. Luce, decided to go ahead anyway after learning from the experts that "this slump may last as long as one year.") Luce wanted a magazine of business that would go beyond "the stale Get-Rich Maxims of onetime errand boys." He knew that businessmen got as "kittenish as a Victorian subdeb" when caught in the public eye but was not prepared for how hesitant corporations were to open their doors. In those days, stockholders were entitled to little information, the public to even less: businessmen had not progressed much beyond William Henry Vanderbilt's "the public be damned" attitude. To get the access it wanted, FORTUNE agreed to show corporations articles in advance, to let them comment and correct errors but not to edit or dictate changes. About 15 years ago, FORTUNE abandoned the practice that New England Business is reviving. "I wish 'em well, but they're opening the doors to problems," says Lewis Young, the editor in chief of Business Week.

Young recalls that in the days before the SEC existed, "there were no required disclosures, no data. Editors had to guess at sales figures." One enterprising FORTUNE writer, doing a story on the secretive Campbell Soup Co., noted how much butter went into a vat of tomato soup, priced the cost of wholesale butter and other ingredients and figured Campbell's annual profits at $6 million. He also estimated the estate of its former owner at $120 million.

A Campbell executive, seeing the article in advance, corrected the figure to $115 million. Unfortunately, businessmen constantly wanted to make other changes, which led to hassles. What an editor considers interpretation, explains Business Week's Young, the businessmen call a fact.

Business and journalism are in a more even balance now. More facts are on public record; corporations have set up sophisticated public relations operations; executives often find it prudent to talk to the press even when the news is embarrassing. All business magazines routinely back-check figures with corporate sources. But they do not provide a prepublication chance to learn what a competitor said or allow a quote by one of the corporation's own executives to be modified. Nobody wants to put out a Congressional Record full of flattened-out prose and "extended remarks." "It's not a good idea," says James W. Michaels, the editor of Forbes. "Business journalism is so competitive these days that when we get an idea, we want to get it out first, without delay. Our first duty is to the readers. We want to make sure they--the business and investment readers--get the first look." There is less careless reporting and ignorant questioning in business journalism than there used to be. Still, grievances exist.

Corporations (unlike ordinary folk) at least can take out an ad in rebuttal. Mobil in particular likes to express itself on all kinds of public questions. In an ad, a company is free to put its best foot forward, and if figures are cited, they will almost certainly be accurate. But the reader wonders whether other facts and contrary arguments have been given their full weight. Skeptical questioning is missing. That is the role the press plays, and it plays it best when it keeps a neutral distance not too hand in glove with its source. This file is automatically generated by a robot program, so viewer discretion is required.