The glib answer to "What did Burson-Marsteller do wrong" in accepting money from Facebook to pitch stories that reflected badly on Google is that they got caught. (See Neville Hobson's background/comment)
In most areas of life drawing attention to the weaknesses, even the wrong doings of competitors is seen as legitimate debating practice.
We should not accept things on face value, and we should take care to weigh all the facts. If we are to be persuaded to take a positive view about products and services, policy or behaviour, we need to consider the negatives. Journalists are taught to investigate both sides of a story, and academics believe that one of their prime roles is to promote 'critical thinking.'
Unfortunately, public relations as presented by the 'professional project' has long had a problem with persuasion. Some strands of (academic) thinking have tried to argue that PR's role is to present information, and have tried to suggest that this can somehow be done in an objective way. Although this has been a hard line to sell, there is wide agreement that PR needs to focus its activities closer to this end of a spectrum of partiality than to propaganda and spin.
The underpinning for such a position is that people don't trust organisations that tell lies. Trust and legitimacy are seen as essential to organisational success, and there is a belief that in recent years PR has cleaned up its act, that practices common in the long ago 1990s are no longer seen as acceptable.
In what is almost an apology, Burson-Marsteller said:
The client (Facebook) requested that its name be withheld on the grounds that it was merely asking to bring publicly available information to light and such information could then be independently and easily replicated by any media. Any information brought to media attention raised fair questions, was in the public domain, and was in any event for the media to verify through independent sources.
Whatever the rationale, this was not at all standard operating procedure and is against our policies, and the assignment on those terms should have been declined. When talking to the media, we need to adhere to strict standards of transparency about clients, and this incident underscores the absolute importance of that principle."
The key phrase highlights the 'need to adhere to strict standards of transparency.'
The admission is that while highlighting weaknesses in a competitor's position is legitimate, approaching journalists with a story pitch without saying who the client is, is not.
Few people have thought more carefully about PR ethics than Johanna Fawkes. In a series of papers she draws on the analytical psychology of Carl Gustav Jung to argue that those trying to understand PR need to acknowledge its dark side.
Her approach uses Jung's notion of the shadow, those elements of the personal unconscious which are not considered acceptable to the conscious self, to suggest examination of PR ethics would benefit from a similar approach: "How can one have professional ethics if they are based on denial of large swathes of practice?"
As Kevin Moloney argues in Rethinking Public Relations the "Grunigian paradigm takes teaching and writing by the PR academy into a neverland of perfection."
Perhaps when those arch critics of PR David Miller and William Dinan have a point when they write in A Century of Spin:
"Many academics specialising in PR attend to the often apolitical technicalities of PR practice. The broader issues of what evasion, deception and manipulative communications are doing to democratic structures are ignored."
Fawkes' has refined her position since publishing Integrating the shadow: A Jungian approach to professional ethics in public relations in Ethical Space: The International Journal of Communication Ethics, Vol 6, No 2 in 2009 but her paper is well worth reading.