Does the “pub test” have a legitimate role in issue management?

May 23, 2021

What really is the “pub test” and does it have any proper or legitimate role in issue management or government policy? Or is it simply a lazy substitute for reasoned argument?

This question has renewed focus since Christine Holgate, former CEO of Australia Post, lost her job when the Prime Minister and others decided the performance reward of luxury watches for four senior executives “didn’t pass the pub test”. It was also claimed her action was “inconsistent with community expectations” – even though it was self-evident that cash bonuses of a similar value would likely have raised no such objections.

The “pub test” and “community expectation” have no objective meaning and have become little more than a rubric for whatever suits the political or corporate or media agenda.

Some argue that the “pub test” is simply a slang and ill-defined phrase for perception analysis which is the underlying rationale for all issue management. While that may be true, the danger is that the “pub test” has become not just a slang phrase for proper perception analysis but a lazy and convenient substitute for reasoned argument.

Understanding stakeholders and their perceptions is fundamental to effective issue management and, if perception analysis is properly understood, it ought to be based on independent, representative data and applied to decision-making in the same way as the traditional analysis of other risks and challenges confronting corporations or government.

It is hard to imagine a CEO taking a substantial acquisition proposal to the Board based solely on “gut feel”, or a new product development project without detailed market research. Yet when it comes to controversial public issues, it seems that perception analysis is sometimes just baldly asserting consistency with public opinion through some ill-defined “pub test” or vague appeal to “community expectation.” Is that really a sufficient basis to remove the CEO of a major corporation?

Risk guru Peter Sandman has been telling us for more than 40 years that perception is driven as much by Outrage (emotion and feelings) as it is by Hazard (data and science). Look no further than the public perception of the risks of COVID-19 vaccination. Sandman counsels that emotions and data are both critical to promoting public acceptance. Most importantly he emphasises that both can be measured, and both can be managed.

Which brings us back to the “pub test”. Without objective information, it is – at best – a data-free view of what some selective part of the public might think. At worst it’s no more valid saying “this is what some of my friends think” or “this is what I read on Twitter” or “this is what is politically smart”. Or as the late New Zealand Prime Minister Rob Muldoon used to say: “this is what my mailbox tells me”.

Even Christine Holgate’s boss, Australia Post Chairman Lucio di Bartolomeo, told the government inquiry into the whole debacle that she was treated “abysmally”; that she was good at her job; and that the purchase of luxury watches “was an error of judgement made in good faith from an otherwise highly effective CEO.” The crucial point here is that the so-called “pub test” is often based not on any demonstrable body of public opinion, but instead on some individual’s unsubstantiated guess about what public opinion might be. It is certainly no substitute for structured perception analysis . . . or even a principled statement.

How refreshing it would be if a senior executive or politician – instead of hiding behind the shield of an anonymous “pub test” – was honest and said: “This is my personal view based on what I believe should be acceptable to the community.” While such candour might be a long time coming, it’s time to retire the conveniently imprecise idea of the “pub test” as any basis for managing a high-profile issue.

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