Web essay competition has Sinopec red faced

SINOPEC may be eager to learn from its global competitors how to use online social media to promote its image, but so far it is proving to be a poor student.
China's state-owned oil major has come under fire this past week amid disclosures that it used its own employees to pose as average netizens and post online comments supporting a rise in refined fuel prices.
Sinopec's move comes as the government, which regulates retail fuel rates, is expected to raise prices under a cost pass-through mechanism linking domestic rates to international crude prices. A rise in fuel prices would expand the profit margins of oil firms, but stir dissent among motorists.
In what was billed as an internal essay competition, Sinopec encouraged its "online promotion staff members" to write short articles on popular online forums and blogs to "create a positive environment of public opinion for the increase in fuel prices," according to a company notice fast circulating online after being posted by Sun Haifeng, deputy dean of the communications college at Shenzhen University.
To win awards, the workers were required to pose as netizens from outside Sinopec.
Publicly, Sinopec wouldn't confirm the authenticity of the internal contest memo, but a source at China Petrochemical News, Sinopec's own newspaper and a co-organizer of the essay competition, verified the news.
"The aim was for 'troop training,'" an unidentified Sinopec official told Beijing Business Today.
For Sinopec, the mission backfired. Instead of engendering positive public opinion, the company now finds itself the target of public attention and anger.
"Are you playing with our -intelligence," an online comment said. "Next time please speak in the name of your company."
"Just imagine what would happen if real netizens posted online comments addressing the idea of lowering fuel prices in the name of Sinopec," another said.
According to the Sinopec notice, contestants were told to base their essays along the following lines: The change in international crude prices since December 22 when China last increased fuel prices is enough to trigger a price hike; the surge in crude costs will push refiners deep into the red in the absence of a price hike; the current fuel prices reflect a level that's US$16 below global crude prices.
Under the pricing mechanism, the government may, but is not required, to revise gasoline and diesel prices when prices of a basket of benchmark international crude oil prices changes more than 4 percent over 22 working days.
Since the crude basket has risen more than 10 percent, analysts are expecting a price increase as early as this weekend, just as China's busiest transport season of the year is ending.
The National Development and Reform Commission, which sets fuel prices, also considers other factors in pricing decisions. They include inflationary pressure and demand-supply conditions. As a result, the commission has either postponed price increases or reduced their scale in the past to reduce a negative impact on the public.
The pricing mechanism was designed to ensure reasonable profit for Chinese refineries, which suffered huge losses when crude costs were high and the government capped refined product prices. The mechanism has been welcomed by oil company investors since it was introduced in late 2008.
There's nothing wrong, of course, with a company like Sinopec lobbying for higher fuel prices given the profit-driven nature of a company. The higher prices for crude do lend credence to its arguments.
But the sneaky way the company chose to try to get public opinion on its side has left Sinopec looking childish and clumsy. That's hardly the image of a responsible major corporation, nor does it do much to dispel the public's perception of large state companies - usually industry monopolies - as nests of duplicity and double dealing.
Typically, when Sinopec and domestic peer China National Petroleum Corp come up against public criticism, they defend themselves by emphasizing their corporate status, washing their hands of political and social responsibilities. But when they wish to manipulate public opinion to their advantage, such as in response to calls for an end of market monopolies, they are fond of evoking calls for political stability.
The current anger directed at Sinopec is not so much disdain at a company seeking to maximize profits, but rather scorn for the -contempt the company seems to show -toward the public even as it touts its corporate social responsibility.
This inept public relations scam is the -latest in a series of corporate gaffes played out on the Internet.
Last year, the online tussle between dairy -industry giants Mengniu and Yili and the scrap between Internet firm Tencent Holdings and software provider Qihoo 360 seriously damaged the image of all the companies involved.
In Sinopec's case, there was no competitor involved. The company was well and truly hoisted by its own petard.
Source:Shanghai Daily