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On the Arts: Everybody profits as corporations spend millions to collect art

Sunday, December 29, 2002

By Tim Vincent

Among Enron's woes surrounding its collapse last year was the loss of its ambitious $20 million program for the purchase of contemporary art. Lea Fastow, wife of embattled CEO Andrew Fastow, headed an acquisition committee that, by the time of Enron's bankruptcy, had spent $4 million in the first year of the committee's operation.

Works by pop artist Claes Oldenburg, minimalist sculptor Donald Judd, video artist Nam June Paik and others were intended to grace Enron's massive new headquarters in Houston, rivaling art museums and outpacing other corporate collections such as those at Microsoft, Seagram, Prudential, Frito Lay, Forbes and Chase Manhattan Bank. These days, however, most of Enron's art is on loan to museums, packed away in boxes or being picked over by potential buyers.

Amassing an impressive art collection worth millions while falsifying records to hide revenue losses is apparently something the Fastow couple could live with, and it reveals the arrogance that characterized much of Enron's handling of its financial and legal problems. But what else would motivate a company to launch an aggressive art program in the face of sagging profits?

The answer to this lies in the enormous image enhancement that high art provides to companies that, more often than not, earn their money by producing rather mundane commodities and services. Reader's Digest Association, for instance, which isn't the flashiest publisher around, auctioned off part of its collection of Impressionist and modern art at Sotheby's for $86.6 million in 1998. This was the same year the Sara Lee Corporation, associated in the popular mind with frozen pastries, donated part of its own collection of Impressionist and modern art, worth more than $100 million, to museums in the United States and around the world.

Apart from the profits and tax relief such sales and donations generate for companies, they also produce what social theorist Pierre Bourdieu has called "cultural capital," the prestige and importance that come with a reputation for high-mindedness and civic responsibility. Cultural capital is especially important for companies that make things that can hurt people, such as tobacco and alcohol. It's no accident Philip Morris and Seagram have two of the most respected corporate art collections.

Enron didn't struggle with image problems such as cigarettes and booze, but the energy company's attempts to avoid regulation by the Securities and Exchange Commission, its controversial purchase of Portland General Electric in 1997 and its implication in the energy crisis in the West resulted in a public relations crisis that called for a new building stuffed with expensive art to signal a company still at the top of its game. Unfortunately, the signal was as empty as Ken Lay's thumbs-up speeches at employee gatherings.

Whether Enron's failed foray into big-league collecting represents a gain or a loss for art depends on how one views corporate art collecting in general. Industry and art have had a close, if sometimes strained, relationship since before the powerful Medici family mixed an interest in banking, textiles and Renaissance art in 15th-century Italy. In the United States, corporate art collecting began when the Atchison, Topeka & Santa Fe Railway decided to burnish its image by commissioning art for its calenders and advertising billboards at the turn of the 20th century.

But the biggest period by far for corporate art collecting was the sky's-the-limit decade of the 1980s. No upscale law, financial or accounting firm was complete without its lobby and executive offices adorned with art that represented the image of itself it wished to project. Today's collecting has calmed a bit from the collection-building rush of the 1980s, but corporate collections remain an established element of the art world.

The problem for art in all this corporate activity, however, is that the art usually represents the corporate image and interests rather than the other way around. Art that facilitates a productive work environment or solid investments usually does not include controversial social criticism, nudity or political statements of any kind.

The corporate preference for innovation over ideology can be seen in the Enron collection. Along with Judd's untitled wall sculpture, Oldenburg's "Soft Light Switches" and June Paik's "Retrobot," the collection's most expensive piece was Martin Puryear's "Bower," an abstract sculpture bought for $766,000. Other works included video art by Bill Viola, a pop word piece by Ed Ruscha, a pop painting by John Wesley called "Phone" and abstract installation pieces by Olafur Eliasson and Jack Pierson. Technological pieces such as John F. Simon Jr.'s 50-inch plasma screen of computer images, sort of a giant screen-saver, exemplified a collection wishing to associate its company's image with innovative art.

Such appropriation of the popular conception of artist as innovator is rarely described as image enhancement by corporate spokespeople. Instead, it is often placed in a philanthropic context. The company has a "deep commitment" to the arts, or it wants to make a "lasting contribution" to its local and national cultures. The fact that such commitments and contributions often require millions of shareholder dollars, shift the focus of culture from public domain to private enterprise and turn tax-supported museums into tax shelters for big business seldom gets mentioned.

Despite the self-interested nature of corporate collecting, however, museums would be crazy to pass up gifts on the scale of Sara Lee Corporation's offering of paintings by giants like Monet, Picasso, Matisse, Pissarro and Chagall. It's also true that, regardless of corporate motivations, the public does benefit from access to art that might ordinarily spend most of its time in executive suites or in bank vaults.

Still, there is a difference between the corporate collector and the legendary private collector of earlier times. Artists have always relied on patrons, collectors and galleries, but the point was usually to promote the artist first and the patron, collector or gallery second or not at all.

Today, big money and art still work together, but art as business asset positions artists in the role of serving corporate clients. Most major galleries and auction houses such as Christie's and Sotheby's now have corporate collections departments that advise companies seeking to build cultural capital to compete in the multinational business arena.

Enron's flurry of art buying in the face of bankruptcy is easier to understand if one keeps in mind the extent to which image determines outcome in today's marketplace. Creating the right image for a profitable outcome is enormously expensive, and given the price of media advertising -- typically hundreds of thousands of dollars per minute on network television -- other avenues of image enhancement, such as sponsoring cultural events and art exhibitions, are relatively inexpensive by comparison.

In addition, art collections are mobile, require few employees to maintain and increase in value with every high-profile exposure to the public. Collections are also extremely flexible in terms of the variety of events that can form around them, from highly publicized acquisitions to highly publicized glittering top-management and politician get-togethers to highly publicized philanthropic donations to museums. The key phrase is "highly publicized," most of which is free media coverage of the endlessly fascinating comings and goings of the company's art collection.

This is more than a win-win situation; it's a public relations triumph.

Tim Vincent teaches literature and writing at Shady Side Academy.

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