From Bell Pottinger to Dubai: Rebuilding a reputation

Former boss of the once-notorious London PR agency tells The National how reputations can be repaired and why he has his sights set on the Gulf

James Henderson. Photo: Aasiya Jagdeesh / JBH Public Relations

James Henderson does not scare easily these days. He puts that down to his experiences over the past decade.

They have ranged from rubbing shoulders with Britain's royals and the rich and famous at gala dinners, to being in the unenviable position of having your business reputation torn to shreds, with lawsuits filed against him, and an associated relationship break-up.

“I guess one of the benefits when you lose a lot is, probably, you’re less frightened,” Mr Henderson told The National with a wry smile while enjoying a coffee at one of the finest hotels in London's Mayfair.

Eight years ago, he led London PR agency Bell Pottinger, which was formed by former prime minister Margaret Thatcher's favourite public relations guru, Tim Bell, in 1987.

In 2010, the company merged with Pelham Public Relations, a firm Mr Henderson founded in 2004, and he went on to become Bell Pottinger's chief executive and the toast of London's PR industry.

But by 2017, it had all come crashing down thanks to a scandal thousands of kilometres away involving Jacob Zuma, president of South Africa at the time, and his questionable relationship with three immigrant brothers from India.

That scandal destroyed Bell Pottinger in quick order – Mr Henderson resigned, partners were fired and the company went into administration within weeks.

But despite a seriously bruised reputation, he dusted himself off and opened a small, boutique PR firm in London shortly afterwards, which he describes as a “very high-impact media delivery agency”.

Then he saw a gap in the market last year – not in London, but in Dubai.

“I was offered one contract with a company and I saw the opportunity to go to a growth region and really try to set up a business where they have a lot of PR agencies, but no one – I don't think – with my level of experience, who’s been doing it for 35 years,” he said.

“It's very exciting place to be, because these economies want to double over the next 10 years.”

To Mr Henderson, the opportunities in the Gulf run both ways: From London clients interested in doing business in the Middle East and seeking representation there; to rapidly expanding Middle East companies looking to enhance their profiles outside the region.

Take, for example, his work with Emaar Properties, which has a global portfolio, using its local operational base.

“One of the things that surprised me was that when I arrived in Dubai I'd never heard of companies like Emaar, and I don't think many people have outside the Middle East region," he said.

“So, I think there is a job to be done on creating international profiles.”

'Guptagate'

Every story of a phoenix-like recovery needs the ashes as the starting point.

Bell Pottinger had the DNA of Mr Bell and worked with international clients, including myriad governments and leading society figures including flamboyant hotelier Sir Rocco Forte and Sarah Ferguson, former wife of Prince Andrew.

It even assisted with the once-in-a-generation sale of Harrods.

It has been a long road back from the depths of the Bell Pottinger collapse when it was riding high. The cause was a scandal that would later be called "Guptagate", which reverberated from London to South Africa.

The close relationship between the Gupta brothers – Ajay, Atul and Rajesh – and Mr Zuma first gained notoriety in 2013, when the family members were granted permission to use a military airbase near the country's capital, Pretoria, on their way to a wedding.

Two of the president's children worked for Gupta companies in a business empire that spanned several sectors in the South African economy, included mining, media and technology.

Reports on family's influence over Mr Zuma and other members of the ruling ANC party flooded the South African media, and the term “state capture” was coined.

It was at this point that Oakbay Investments, one of the principle companies in the Gupta stable, hired Bell Pottinger to improve the family's reputation in South Africa.

That led to accusations of attempts being made to deflect attention away from the relationship between the Guptas and Mr Zuma.

The battle for public opinion at the time became murkier as accusations of social media manipulation, corruption and even bribery of top officials made headline news in South Africa on a daily basis.

Damaged reputations

By the end of 2016, Bell Pottinger had lost other South African corporate clients as a result of its relationship with Oakbay and the Guptas, including Investec bank and Swiss luxury goods company Richemont, led by South Africa's richest person Johann Rupert and home to brands such as Cartier, Montblanc, Dunhill and Van Cleef.

By mid-2017, events were moving fast. South Africa's official opposition party, the Democratic Alliance, lodged a complaint regarding Bell Pottinger with two UK PR industry bodies, the Public Relations and Communications Association (PRCA) and the Chartered Institute of Public Relations (CIPR).

Despite the fact that by this point Bell Pottinger had not worked with Oakbay for months, the PR company itself was increasingly becoming a news story in the South African and the British press.

“I was never involved with the account directly,” Mr Henderson insisted.

“I never met them [the Gupta brothers], never sent an email and I didn't pitch for it.

"But at the time we won that mandate, I was not aware, and no one made me aware and I don't think many people were aware of the extent of the political situation within South Africa and the concern relating to Oakbay and the Guptas.”

By early July 2017, Bell Pottinger had hired a London law firm to review its dealings with Oakbay and the accusations that it had tried to deflect attention away from the Guptas by way of an intentional campaign aimed at inciting racial divisions in South Africa.

At the same time, Mr Henderson issued an apology and four Bell Pottinger employees were fired, including the lead partner on the Oakbay account.

But it was not enough to stop what was by then the inevitable collapse of Bell Pottinger. By September, Mr Henderson had resigned as chief executive and the PRCA had said Bell Pottinger “brought the PR and communications industry into disrepute with its actions”.

“It was a very, very sad time,” Mr Henderson said, “but if you've got a large number of your clients with £80 million worth of revenue leaving in a day, and your reputation is severely damaged, you can't guarantee that in any way you’re going be able to replace that business.”

Fallout

Repercussions followed the collapse of Bell Pottinger, with several lawsuits seeking money to be paid to accountants and shareholders, and legal action to ban certain partners from being company directors elsewhere.

The UK's insolvency service disqualified two former partners from being directors, but Mr Henderson avoided that sanction.

“The insolvency service was trying to disqualify me as a director,” he said.

“They spent five years and then withdrew it and they've had to repay £5 million of costs, having gone through every single email I've ever done. So, it was quite clear from a personal perspective that I did all I could.”

It is a point that he makes several times during the interview. But that's not to say Mr Henderson denies mistakes were made.

“We didn't have a team in South Africa, we had no office in South Africa,” he said.

“I think if we had a team on the ground, they would have been more attuned to the sensitivities, and then it probably wouldn't have happened.

“Also, I was originally told that the pitch was for the South African government – it was only afterwards that it transpired it was for the Guptas.”

While Mr Henderson has tried to distance himself from direct knowledge of the working details of what certain Bell Pottinger partners and staff were up to at the time, he also feels that the company became an “easy political football that was caught in a difficult situation” in South Africa.

“Clearly, we were acting for the wrong people and we were caught in a political crossfire,” he said.

“Certainly, within the last two months of Bell Pottinger’s existence, there was a huge campaign against [it], even though we hadn't been working for the Guptas for several months.

“Campaigns like that don't happen on their own. I was receiving probably 40 to 50 personal emails a day with death threats.

“The day that I resigned and then the day Bell Pottinger ceased to exist, I never got another email. I'm not a conspiracy theorist but there were a number of issues at play.”

The Bell Pottinger saga changed the landscape for PR firms in London and was little short of seismic for the industry. It opened questions about how it ensured it was not littered with bad apples skilled at “dark arts”.

Prof Robert Barrington at the University of Sussex in the UK has described the Bell Pottinger affair as the “tip of a very unsavoury iceberg” that had long been neglected.

Mr Henderson believes the industry has become extremely risk-averse after the events at Bell Pottinger and that large PR firms are more willing to turn down accounts and are doing much more due diligence on clients.

“I think, not only because of the Bell Pottinger situation but also of what's happening globally, people are very, very careful in terms of cancel culture and everything else.

“People are very, very careful about who they advise.”

Rebuilding

The basic capital of a reputation management company is its own reputation. Without that validation, it is almost impossible to attract fee-paying clients.

As such, Bell Pottinger's partners and staff spent the years after the agency's collapse putting as much distance between themselves and the ghost of the firm's ruined corporate reputation.

The overseas arms changed their names or were bought out while its employees went on to join other agencies or founded their own.

“I hope the ghost is fading more and more every year,” Mr Henderson told The National.

“No one can say it’s finished because in today's age, things stick with you for quite a long time. But I hope people focus on what I've done since and what I'm doing and trying to do.”

“When you lose your reputation, that's obviously very difficult to deal with.”

In early 2018, Mr Henderson set up J&H Communications in London, which has now been rebranded as Soho Communications, which he calls a “capsule, multi-discipline mini Bell Pottinger type” covering brand-building, reputation management, and corporate, financial and personal campaigns.

Having opened a small office in Dubai last year, his focus is now on the Middle East, because he believes the enormous growth in the region has created a gap in the PR market.

“Look at the Dubai 2030 vision and who doesn't want to be in a place where it's all about growth and future?" Mr Henderson says.

“In the UK and other European countries, it's a different agenda at the moment – things seem to be going backwards, not forwards.”

He believes some companies and governments in the Gulf have missed out on PR opportunities recently and that the region's remarkable achievements could use more promotion.

“I was surprised during Cop28 they didn't do more to market Dubai as one of the top global cities in the world.

"Everything was really centred around the Expo but they could have had receptions at Burj Khalifa, for instance, to promote Emaar and the fact they've built one of the most impressive things in the world.

“I would have advised them to maybe consider having a reception there as a showcase on Dubai and really used Cop28 to show what’s been achieved in Dubai and the UAE.”

While Mr Henderson denies his PR career has risen phoenix-like in Dubai from the ashes of Bell Pottinger in London and that he did not come to the UAE to “escape”, he does see his future in Dubai and the Gulf.

“London is a very mature PR market,” he said, “but it wasn't when I set up my financial PR business in 2004.”

“Back then, it was an opportunity. I knew exactly how to develop it, because everyone had to have a PR firm if you were listed [on the London Stock Exchange], and it was just a question of doing a better job than the others.

“Now, it's a very different market. No one needs just a financial PR business. They tend to have internal teams, they use social media and all sorts of different agencies.

“So, it's difficult to define yourself, whereas I think it's easier to define yourself in the Middle East.”