Illustration: Fernanda Cohen
"I had a client with a large event at the Rainbow Room, and when Cipriani got busted for tax problems, the client canceled the event one day before signing the contract," says Rex Duval, owner of the Rex Duval Group, of his experience planning an event for a major international technology and manufacturing company. "The client was very conservative and didn’t want to be linked with anyone not potentially on the up-and-up."
That’s the kind of fallout that can happen when vendors find themselves surrounded by controversy. In this particular case, in July, Giuseppe and Arrigo Cipriani, owners of some of the most popular venues in New York, pleaded guilty to tax evasion to the tune of about $10 million.
The venue moguls are not the only heavy hitters in the field to have recently earned some less-than-flattering ink in the press. This summer saw employee wage and discrimination complaints against celeb chefs Jean-Georges Vongerichten and Daniel Boulud, respectively. And in January, the Fox affiliate in New York accused caterer Mood Food of not paying its caterwaiters.
All of this press is no doubt a potential black eye for those involved, but does any of it matter when planners are deciding which suppliers to sign up for a party?"Right after the news hit [about the Cipriani case], we definitely saw an uptick in people who had events at Cipriani calling us," says B. Allan Kurtz, managing director of New York's Gotham Hall, the style and size of which are similar to some Cipriani locations. For example, "the board of directors of a nonprofit were hesitant doing an event [in a Cipriani space] so soon after certain news came out." (In the end, the events stayed put, but one organization plans to move to Gotham Hall in 2008.)
Overwhelmingly, the primary reason both corporate planners and independent producers cited for shying away from a vendor cloaked in scandal was the impact an association with the supplier might have on their company or client. "The whole point of doing an event is, you are relaying what your company is all about," says Edna Greenbaum, executive director of the Council of Protocol Executives, an organization of event planners. "If someone called me up and asked, ‘What would you recommend about [using a vendor involved in a scandal]?’ I’d say, ‘Don’t do it.'"
Kim Boriin, senior event marketing specialist with Guardian Investment Services, is very sensitive to the issue of vendors’ business practices and how they will reflect on his company. "Oh, yeah, absolutely," he says. "We don’t want to compromise the integrity of our brand. That’s why we stick with four- and five-star hotel properties. This is the caliber we’re accustomed to sharing with our clients, and if somehow that were compromised, the meeting would be moved or postponed."
Still, plenty of hosts went on using vendors and venues that were enduring some sort of scandal; not surprisingly, several whom we called declined to comment on why.
If the Cipriani case is having an effect, it’s not reflected in the company’s bottom line. Cipriani spokesperson Chris Giglio reports that 2007’s business, including corporate, philanthropic, and social events, is up 10 percent from last year and marks a record-breaking year for the company.
Meanwhile, for Boulud, "Our private events business is as strong if not stronger than ever," says Georgette Farkas, director of public relations at Boulud's Dinex Group. "People know [Daniel Boulud’s] integrity, quality, and creativity in what he does."
Mood Food owner Tinker Boe offered this statement: "Mood Food has been in business for almost 25 years, and we have a lot of loyal customers. Most stayed with us, and business is as good as ever. The vast majority know us well enough to disregard the one-sided and inaccurate Fox 5 story." (Representatives for Vongerichten declined to comment.)
At the offices of Grayson Bakula Design in New York, the Cipriani news did, in fact, prompt a discussion of how it might affect planners’ hiring practices. "It comes down to the type of client, and does the client not want to have its name attached [to a vendor]?" says co-owner Carolyn Bakula. "We have clients that are law firms; they might think twice." But for an internal event with no press coverage, concerns about an association with a vendor may dissipate.
Susan Norcross, special events director at Cashman & Associates, which handles events and PR for companies in New York and Philadelphia, sees involving even a temporarily besmirched provider as further muddling an already complicated process. "I want to present my clients in the best light. If a client is reading about someone in the paper, it puts a question in their mind," she says. "If something adds another layer of stress, you do stay away."
Norcross cites the current controversy in Philadelphia over restaurants serving foie gras as a situation that could affect her decisions. Animal rights activists are picketing eateries that offer the debated delicacy. "If I had a client dinner ... I might pick a restaurant that doesn’t serve foie gras," she says.
Washington, D.C.-based Mary Ellen Dobrowolski, director of programs and industry relations for the Air Force Association, reports that there’s no gray area for her employer on the issue. "Honor and doing business in an ethical manner are very important to us," she says. But even if she were working in the corporate sector, as she once did, Dobrowolski would hesitate to hire a vendor with any ethical blemishes: "It says a lot about how they do business, and how they’ll do business with me." She also cites how a scandal tainted provider might affect guests’ comfort at an event, and says she would want to know the details of any situation concerning a vendor.
Rex Duval, in fact, did seek more information on the Cipriani case, and went so far as to speak with their attorney. After learning more, "I had no moral dilemma at all," he says. Duval adds that he’s more concerned with "the big picture" and how a vendor’s actions affect the people he deals with directly. (He was not the only person to voice this opinion.) "I’m more interested in how you treat your employees, the waitstaff, busboys," he says. "That, in essence, affects the quality of your event. ... You work your tail off, and you can have one disgruntled waiter ruin the whole event."
Beyond PR and business concerns, there’s the issue of whether a supplier’s alleged or confirmed practices offend a planner personally. Would that keep a contract from being signed? For Greenbaum, personal integrity tops the list of reasons to shy away from a controversial vendor. But more than one professional suggested that depending on the host and the offending vendor, the rub-off effect may be minimal. "If a huge lawsuit comes out all of a sudden that a [general manager] is embezzling money, it’s probably not going to affect your event," Norcross says. "It’s probably not going to hurt [the host], because that has nothing to do with holding the event there."
"If it’s a small company and you deal with the people involved, it might be different," Bakula says. "Cipriani is almost a corporation. Do you not go to Home Depot because the Home Depot senior management is having infrastructure problems?"
Case in point: Duval’s feelings about the Rainbow Room staff. "They are the best, most professional people you could deal with in a million years," he says, "but I understood the client’s concerns."
The good news for any scandal-embroiled vendor is that nearly every person we spoke with pointed out people’s relatively short memories. "You can do something sordid," Duval adds, "and when it breaks, people say, ‘Oh, oh, oh. ...’ And a few months after that, they say, ‘Oh.’ And a few after that, no one remembers it."
That’s the kind of fallout that can happen when vendors find themselves surrounded by controversy. In this particular case, in July, Giuseppe and Arrigo Cipriani, owners of some of the most popular venues in New York, pleaded guilty to tax evasion to the tune of about $10 million.
The venue moguls are not the only heavy hitters in the field to have recently earned some less-than-flattering ink in the press. This summer saw employee wage and discrimination complaints against celeb chefs Jean-Georges Vongerichten and Daniel Boulud, respectively. And in January, the Fox affiliate in New York accused caterer Mood Food of not paying its caterwaiters.
All of this press is no doubt a potential black eye for those involved, but does any of it matter when planners are deciding which suppliers to sign up for a party?"Right after the news hit [about the Cipriani case], we definitely saw an uptick in people who had events at Cipriani calling us," says B. Allan Kurtz, managing director of New York's Gotham Hall, the style and size of which are similar to some Cipriani locations. For example, "the board of directors of a nonprofit were hesitant doing an event [in a Cipriani space] so soon after certain news came out." (In the end, the events stayed put, but one organization plans to move to Gotham Hall in 2008.)
Overwhelmingly, the primary reason both corporate planners and independent producers cited for shying away from a vendor cloaked in scandal was the impact an association with the supplier might have on their company or client. "The whole point of doing an event is, you are relaying what your company is all about," says Edna Greenbaum, executive director of the Council of Protocol Executives, an organization of event planners. "If someone called me up and asked, ‘What would you recommend about [using a vendor involved in a scandal]?’ I’d say, ‘Don’t do it.'"
Kim Boriin, senior event marketing specialist with Guardian Investment Services, is very sensitive to the issue of vendors’ business practices and how they will reflect on his company. "Oh, yeah, absolutely," he says. "We don’t want to compromise the integrity of our brand. That’s why we stick with four- and five-star hotel properties. This is the caliber we’re accustomed to sharing with our clients, and if somehow that were compromised, the meeting would be moved or postponed."
Still, plenty of hosts went on using vendors and venues that were enduring some sort of scandal; not surprisingly, several whom we called declined to comment on why.
If the Cipriani case is having an effect, it’s not reflected in the company’s bottom line. Cipriani spokesperson Chris Giglio reports that 2007’s business, including corporate, philanthropic, and social events, is up 10 percent from last year and marks a record-breaking year for the company.
Meanwhile, for Boulud, "Our private events business is as strong if not stronger than ever," says Georgette Farkas, director of public relations at Boulud's Dinex Group. "People know [Daniel Boulud’s] integrity, quality, and creativity in what he does."
Mood Food owner Tinker Boe offered this statement: "Mood Food has been in business for almost 25 years, and we have a lot of loyal customers. Most stayed with us, and business is as good as ever. The vast majority know us well enough to disregard the one-sided and inaccurate Fox 5 story." (Representatives for Vongerichten declined to comment.)
At the offices of Grayson Bakula Design in New York, the Cipriani news did, in fact, prompt a discussion of how it might affect planners’ hiring practices. "It comes down to the type of client, and does the client not want to have its name attached [to a vendor]?" says co-owner Carolyn Bakula. "We have clients that are law firms; they might think twice." But for an internal event with no press coverage, concerns about an association with a vendor may dissipate.
Susan Norcross, special events director at Cashman & Associates, which handles events and PR for companies in New York and Philadelphia, sees involving even a temporarily besmirched provider as further muddling an already complicated process. "I want to present my clients in the best light. If a client is reading about someone in the paper, it puts a question in their mind," she says. "If something adds another layer of stress, you do stay away."
Norcross cites the current controversy in Philadelphia over restaurants serving foie gras as a situation that could affect her decisions. Animal rights activists are picketing eateries that offer the debated delicacy. "If I had a client dinner ... I might pick a restaurant that doesn’t serve foie gras," she says.
Washington, D.C.-based Mary Ellen Dobrowolski, director of programs and industry relations for the Air Force Association, reports that there’s no gray area for her employer on the issue. "Honor and doing business in an ethical manner are very important to us," she says. But even if she were working in the corporate sector, as she once did, Dobrowolski would hesitate to hire a vendor with any ethical blemishes: "It says a lot about how they do business, and how they’ll do business with me." She also cites how a scandal tainted provider might affect guests’ comfort at an event, and says she would want to know the details of any situation concerning a vendor.
Rex Duval, in fact, did seek more information on the Cipriani case, and went so far as to speak with their attorney. After learning more, "I had no moral dilemma at all," he says. Duval adds that he’s more concerned with "the big picture" and how a vendor’s actions affect the people he deals with directly. (He was not the only person to voice this opinion.) "I’m more interested in how you treat your employees, the waitstaff, busboys," he says. "That, in essence, affects the quality of your event. ... You work your tail off, and you can have one disgruntled waiter ruin the whole event."
Beyond PR and business concerns, there’s the issue of whether a supplier’s alleged or confirmed practices offend a planner personally. Would that keep a contract from being signed? For Greenbaum, personal integrity tops the list of reasons to shy away from a controversial vendor. But more than one professional suggested that depending on the host and the offending vendor, the rub-off effect may be minimal. "If a huge lawsuit comes out all of a sudden that a [general manager] is embezzling money, it’s probably not going to affect your event," Norcross says. "It’s probably not going to hurt [the host], because that has nothing to do with holding the event there."
"If it’s a small company and you deal with the people involved, it might be different," Bakula says. "Cipriani is almost a corporation. Do you not go to Home Depot because the Home Depot senior management is having infrastructure problems?"
Case in point: Duval’s feelings about the Rainbow Room staff. "They are the best, most professional people you could deal with in a million years," he says, "but I understood the client’s concerns."
The good news for any scandal-embroiled vendor is that nearly every person we spoke with pointed out people’s relatively short memories. "You can do something sordid," Duval adds, "and when it breaks, people say, ‘Oh, oh, oh. ...’ And a few months after that, they say, ‘Oh.’ And a few after that, no one remembers it."
