Olin Experts: Following Oscars drama, Academy Awards has most to lose

In the wake of the slap heard ‘round the world—actor Will Smith’s blow to comedian Chris Rock’s left cheek—scholars in the business of entertainment at the Olin Business School say the situation is shot through with reputational risk.

But not where you might think.

In the middle of the ABC TV broadcast of the Oscars on March 27, Rock’s joke at the expense of actor Jada Pinkett Smith prompted her husband to bound onto the stage and smack the comedian. Soon after, Smith twice shouted at Rock—using an expletive both times—to not mention his wife’s name.

Olin finance Professor Tim Solberg, academic director for the school’s minor in the business of the arts, said the biggest risk may lie within the Academy of Motion Picture Arts and Sciences itself.

As the NAACP in a statement decried “the way casual violence was normalized tonight,” the Academy Awards leadership was considering its response amid calls to take disciplinary action.

“The academy itself may suffer damage if it does not take action,” Solberg said, noting the academy issued a statement saying it does not approve of violence. “There is a lot of discussion on the radio and on the web around this as it relates to a public display of violence by highly visible and admired stars.”

Solberg raised the prospect of the academy stripping Smith of his Oscar for best actor in a motion picture for his role as the father of tennis stars Venus and Serena Williams in “King Richard.” Smith received the award about 45 minutes after the slapping incident. The act of violence could constitute a violation of the academy’s code of conduct.

On Monday, the academy issued a statement condemning the action and noting it would start a formal review to “explore further action and consequences in accordance with our bylaws, standards of conduct and California law.”

Ironically, Solberg said, Smith and Rock may suffer no ill effect in their earnings. “The two stars have their followings and the audience is segmented,” he said. “They will probably not have a drop in earnings as a result. In that sense, their brand is not harmed financially.”

Glenn MacDonald, the John M. Olin Distinguished Professor of Economics and Strategy at WashU’s Olin School, agreed with Solberg.

“In entertainment, they often say there is no such thing as bad publicity. Obviously, getting attention for doing something people would generally find disgusting is a counterexample,” said MacDonald, who teaches a course in the economics of entertainment at Olin. “But a wise guy comedian getting hit on TV by a very physical guy for making a bad comment about the latter’s wife is really just extra attention for a couple of guys in the latter stages of their careers.

Rock’s joke made reference to Pinkett Smith’s hair. She has spoken of her hair loss as a result of alopecia.

Solberg noted a fourth potential stakeholder that could be affected: the movie studios. “While financially, the stars have their brand and their following, unless a studio boycotts or the public cancels Will Smith—a major box office star making money for the company—due to the public show of violence, he will maintain his financial draw even if his brand is tarnished,” Solberg said.