BLACK PR’: EXAMINING the PRACTICE of RUINING REPUTATIONS” by Andrew Foxall

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BLACK PR’: EXAMINING the PRACTICE of RUINING REPUTATIONS” by Andrew Foxall DEFENDINGRUSSIAN ‘BLACK EUROPE: PR’: EXAMINING“GLOBAL BRIT THEAIN” PRACTICEAND THE FUTURE OF RUINING REPUTATIONSOF EUROPEAN GEOPOLITICSBY DR ANDREW FOXALL BY JAMES ROGERS DEMOCRACY | FREEDOM | HUMAN RIGHTS NovemberReport 2020No. 2018/1 Published in 2020 by The Henry Jackson Society The Henry Jackson Society Millbank Tower 21-24 Millbank London SW1P 4QP Registered charity no. 1140489 Tel: +44 (0)20 7340 4520 www.henryjacksonsociety.org © The Henry Jackson Society, 2020. All rights reserved. The views expressed in this publication are those of the author and are not necessarily indicative of those of The Henry Jackson Society or its Trustees. Title: “RUSSIAN ‘BLACK PR’: EXAMINING THE PRACTICE OF RUINING REPUTATIONS” By Andrew Foxall ISBN: 978-1-909035-61-4 £14.99 where sold Cover image: Newspapers and laptop by Photo Kozyr (https://www.shutterstock.com/image-photo/ newspapers-laptop-pile-daily-papers-news-1090031726) DEFENDINGRUSSIAN ‘BLACK EUROPE: PR’: EXAMINING“GLOBAL BRIT THEAIN” PRACTICEAND THE FUTURE OF RUINING REPUTATIONSOF EUROPEAN GEOPOLITICSBY DR ANDREW FOXALL BY JAMES ROGERS DEMOCRACY | FREEDOM | HUMAN RIGHTS NovemberReport 2020No. 2018/1 Russian ‘Black PR’: Examining the Practice of Ruining Reputations About the Author Dr Andrew Foxall was Director of the Russia and Eurasia Studies Centre at the Henry Jackson Society between 2013 and 2020, and served as Director of Research from 2017 to 2020. Prior to joining HJS, he held academic positions at the University of Oxford and Queen’s University Belfast. Andrew is the author of Ethnic Relations in Post-Soviet Russia (Routledge, 2014 and 2017) and has written for publications including The New York Times, Wall Street Journal, The Washington Post, The Daily Telegraph, The Times, Foreign Affairs, TIME, and Foreign Policy. He holds a DPhil from the University of Oxford. Acknowledgments I should like to thank Marcus Kolga, Ilya Zaslavskiy, Roger Field, and two peer reviewers for their feedback on earlier drafts of this document. I should also like to thank the numerous individuals who shared their experiences, both on and off the record, with me, and Jackson Pieters and Layne Philipson for their research assistance. Any errors are, of course, my own. 2 Russian ‘Black PR’: Examining the Practice of Ruining Reputations Contents About the Author .................................................................................................2 Acknowledgments ................................................................................................2 About The Henry Jackson Society .....................................................................4 About The Russia and Eurasia Studies Centre .................................................4 Executive Summary ..............................................................................................5 1. Introduction ...........................................................................................................6 2. What is Black PR? .................................................................................................8 3. Black PR in Contemporary Russia ..................................................................... 11 4. Examples of Black PR ......................................................................................... 14 4.1 Yukos .........................................................................................................................14 4.2 Hermitage Capital Management .....................................................................16 4.3 TNK-BP .....................................................................................................................18 4.4 Toaz .......................................................................................................................... 20 4.5 North-West Timber Company .........................................................................22 5. Conclusion and Recommendations .................................................................25 3 The soUTh China sea: Why iT maTTeRs To “gLoBaL BRiTain” Russian ‘Black PR’: Examining the Practice of Ruining Reputations About Us DEMOCRACY | FREEDOM | HUMAN RIGHTS About The Henry Jackson Society The HenryHenry Jackson Jackson Society Society is a isthink-tank a think-tank and policy-shaping and policy-shaping force that force fights that for fights the principlesfor the principlesand alliances and which alliances keep which societies keep free,societies working free, acrossworking borders across andborders party and lines party to combatlines to combatextremism, extremism, advance advancedemocracy democracy and real humanand real rights, human and rights, make aand stand make in ana standincreasingly in an increasinglyuncertain world. uncertain world. About The Asia Studies Centre About The Russia and Eurasia Studies Centre The Asia Studies Centre attempts to provide an in-depth understanding of the structural shifts, regionalThe Russia complexities and Eurasia and Studies historic Centre tensions undertakes that exist alongsidein-depth, theanalytically-focussed tremendous economic research and socialinto domestic growth andthat foreigntraditionally policy characterise issues in Russia the “riseand theof asia”.other post-SovietWith some predictingstates. Established that the regionin 2010 will as theaccount Russia for Studies 40% of Centre, global gDPthe programme’s by 2050, a post-Brexit geographical Britain scope must has develop widened a foreign since policy2014, mirroring posture for the the high region level that of importance navigates British attached economic to the interestsregion. and cultural and political values on the one hand, while maintaining strong support for regional liberal democracies and international law on the other. About the Global Britain Programme The Global Britain Programme is a research programme within the henry Jackson society that aims to educate the public on the need for an open, confident and expansive British geostrategic policy in the twenty-first century, drawing off the United Kingdom’s unique strengths not only as an advocate for liberalism and national democracy, but also as a custodian of both the european and international orders. 28 4 Russian ‘Black PR’: Examining the Practice of Ruining Reputations Executive Summary l ‘Black PR’ (chernyi piar) is a catch-all term that refers to a range of practices that seek to damage and discredit the reputations of individuals and entities. The practices blur the division between legal, semi-legal, and illegal, and are used by state, quasi-state, and non-state actors. These practices include: kompromat (comprising material); zakazukha or zakazyne stat’i (prepaid publications); dvoiniki (the process by which individuals with the same or similar names to an election rival register as candidates in order to confuse voters). l Originally, black PR referred to manipulative practices that were associated with the introduction of competitive elections in the early 1990s. Political consultants – or so-called ‘political technologists’ – who acted on behalf of the state, or on behalf of oligarchs close to the state, oversaw these practices. In the 1996 presidential election, the oligarchs made use of their significant media holdings and political technologists hallucinated the threat of a looming ‘red-brown’ menace to win then-President Boris Yeltsin a seemingly lost election. l Since Vladimir Putin came to power in 2000, he has overseen the creation of a grotesque kleptocracy in Russia. This kleptocracy has sought to own all forms of political discourse in the country and, in doing so, has centralised and systematised black PR practices in the Kremlin. As a result, black PR is now used across all aspects of life, most notably in business wherein it is an integral part of the widespread practice of corporate raiding (reiderstvo). l Black PR is not only used by the Kremlin or regime insiders. In a country where it is possible to buy a court decision, pay for a tax investigation into a rival’s business, or where the head of the government-owned national media agency declares that “there is no objectivity – only approximations of the truth by as many different voices as possible”, black PR has become a common feature of many business disputes and transactions. l This report highlights five case studies each of which is a particularly egregious example of how black PR is used as part of the reiderstvo process. To be sure, there are significant differences between them. Some clearly involve the Kremlin, while others involve arms of the Russian state and Russian state-owned entities. Others still involve Kremlin-connected oligarchs and regime insiders. Taken together, however, these cases demonstrate the centrality of black PR to Russia’s business environment. l Black PR does not remain in Russia. Instead, it appears in the West through the Kremlin’s disinformation and misinformation campaigns, and as part of the ‘information laundering’ process. It appears in newspapers and on television, on billboards, and on social media. It also appears in due diligence reports, corporate intelligence investigations, litigation, arbitration, and court submissions, including as a part of the handful of Russian commercial disputes that are heard before London’s courts annually. l This report makes a series of recommendations that focus less on what can be done to stop the creation of black PR in Russia and more on what can be done to reduce the circulation of black PR outside of Russia. These recommendations
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