Bell Pottinger loses clients and staff in wake of South Africa scandal


HSBC, TalkTalk and others say they have stopped working with PR firm after secret campaign to stir up racial tensions

Bell Pottinger is facing a fight for survival as a string of clients and senior staff quit in the wake of the scandal over its secret campaign to stir up racial tensions in South Africa, reports The Guardian.

Clydesdale Bank, the construction company Carillion, HSBC and TalkTalk revealed on Tuesday that they had stopped working with Bell Pottinger. Their departure brings the number of clients to have left the PR agency in the wake of the scandal to seven. Several others are considering their position.

A number of senior staff are also understood to have tendered their resignations from the agency on Tuesday.

The highest-profile departure so far is John Sunnucks, the chairman of Bell Pottinger’s corporate and financial practice. A source said that a number of “people with accounts” – senior figures who directly bring in money – have also quit.

“Headhunters have been all over people for quite a while now,” said one senior executive at the agency. “People are being offered other opportunities. The management focus is on keeping people as calm as they can.”

The exodus follows the decision on Monday by the PRCA, the British PR trade body, to expel Bell Pottinger from its ranks after the firm orchestrated a campaign to stir up anger about “white monopoly capital” and “economic apartheid” for one of South Africa’s wealthiest and most controversial families, the Guptas.

The Guptas have been accused of benefiting financially from their close links to Jacob Zuma, the South African president. Zuma’s son Duduzane has been a director of several Gupta-owned companies and worked for Oakbay, the business at the centre of the scandal. Both have previously denied such a relationship.

Clydesdale Bank and Carillion stopped working with Bell Pottinger in July. This was the same month that the PR firm’s chief executive, James Henderson, offered an “unequivocable and absolute” apology for an “inappropriate and offensive” social media campaign. The agency had previously insisted it was the victim of a smear campaign involving “totally false and damaging accusations”.

At the time Henderson, who resigned on Sunday, also fired the director running the campaign, Victoria Geoghegan, and suspended two other employees.

“[Clydesdale] and its associated brands no longer work with Bell Pottinger,” said a spokesman for the bank. “We decided earlier this year to end our relationship with Bell Pottinger and ceased all work with them in July.”

Britain’s biggest bank, HSBC, which has weathered its own public relations disaster after its Swiss arm helped clients evade tax, also severed ties.

“We have used Bell Pottinger for specific projects in the past but will not be doing so in the future,” the bank said in a statement.

TalkTalk, one of the UK’s biggest broadband operators, had a contract with the agency that ended this year. The company is planning for a new corporate PR and public affairs contract but it is understood that Bell Pottinger will not be asked to submit a bid.

Waitrose, which prides itself on its ethical stance, would not say whether it will definitely continue to employ the embattled agency. “We don’t comment on specific supplier relationships,” said a spokeswoman, who refused to elaborate further.

Arqiva, the owner of Britain’s TV masts, is also understood to be considering its relationship with Bell Pottinger.

Three organisations have already fired the agency over the scandal. They are Richemont, the Swiss luxury company headed by South African businessman Johann Rupert; Investec, the South African investment group; and Acacia, which owns goldmines in Tanzania.

It has also emerged that Bell Pottinger’s second largest shareholder has walked away from the business by writing off its investment and handing back the stake to the struggling PR firm.

Chime, co-owned by US investment firm Providence Equity Partners and Sir Martin Sorrell’s WPP group, gave up trying to sell its 27 per cent holding and is understood to have given the stake to the company’s board several weeks ago as the scandal reached boiling point.