Penn State: Whose Fault Is It?

National advertisers are pulling out of Penn State.

While this is not surprising to those of us in the business of reputation management, some may wonder why leading brands want to avoid the link with Penn State, as an institution, when it appears that the horrible sex crimes were committed by one person there.

Well, in my opinion, there are two primary reasons for the mass exodus of Penn State’s national corporate sponsors: 1) the nature of the transgression and 2) the university’s reaction to it.

The alleged crimes – which involve the ongoing sexual assault of children were compounded by the fact that reports of the abuse (by the children themselves, their parents and Penn State employees) were repeatedly ignored and covered up by the university, according to the Grand Jury Report, making it a university issue.

When action was finally taken, which included firing Joe Paterno, the legendary football coach, and cutting ties with Jerry Sandusky, the alleged pedophile, Penn State students responded by rioting. If you are a major corporation looking to enhance your brand equity, these are not the sort of people you want as your brand ambassadors.

As I noted in my recent interview with the Philadelphia Inquirer, Penn State will likely be a risky investment for potential advertisers for some time to come, as the story’s not over and litigation will probably keep it alive in the near term. It is an unfortunate situation for a university whose motto is “Success with Honor.” However, there are actions that can be taken to begin turning the situation around. The question is whether and when the university will begin to act.