By Fraser P. Seitel
Wotta whining weasel!
No, I’m not talking about Jack O’Dwyer. I’m talking about Greg Smith, the now infamous former Goldman Sachs executive director, who lowered the boom on his former employer of 12 years, with a hand-wringing New York Times op-ed, as he was leaving the building.
Smith’s screed, lamenting a vampire squid culture that “thinks about making money” ahead of client interests, sent shock waves through the halls of the most feared firm on Wall Street. And Smith sympathizers, mostly anti-Goldman critics in the media and government, commended the brave, young ping pong paladin for his courageous stand for truth and justice.
Gag me with a golden, Goldman spoon!
This colossal ingrate, who fed at the Goldman trough at a rate of $500,000 a year, is a latter-day Scott McClellan, retrospectively bad-mouthing the hand that fed him for more than a decade.
McClellan, of course, was the over-his-head George W. Bush White House press secretary, who was forced out in 2007, after the Bushies decided they needed a tougher hombre to battle a hostile media. Their selection of the late Tony Snow, who went toe-to-toe with the White House press corps, was a genius stroke.
In response, the sour grapes McClellan, who worked for W. for nearly a decade, penned an inflammatory memoir that lambasted his former meal ticket and friend. It was a cowardly act of disloyalty on the part of a once- trusted PR advisor, who should have known better.
Similarly, the turncoat Smith spent his dozen years at Goldman in comfortable middle level positions, collecting even more comfortable paychecks. Like McClellan, he admits, after the fact, that he was dismayed at “the decline in the firm’s moral fiber” that he saw around him. But also like McClellan, he apparently said nothing to change the system, while he was reaping his Goldman spoils.
Indeed, as one of hundreds of middle management Goldman “executive directors” who never made it to the real executive rank of “managing director,” Smith‘s motivation for deciding to dump on Goldman as he departs is at least a tad suspect.
What isn’t in doubt is that Goldman Sachs is, as Smith writes, an arrogant organization, filled with arrogant individuals. Smith is also correct that Goldman, like virtually every other bank or brokerage firm or insurance company, pushes its own proprietary products – for which salesman earn higher commissions – on its clients.
Such practices may be, heaven forefend, “callous,” but they are also common in the financial services business. That’s why “caveat emptor” should be the watchword of anyone who takes financial product advice from a banker or broker or insurance salesman. In other words, that’s the way the system works. Get over it.
Finally, no matter how pitiable Mr. Smith’s disloyalty, it is clear that Goldman Sachs is guilty of lousy PR. The open letter, co-signed by CEO Lloyd Blankfein and COO Gary Cohn in response to Smith’s op-ed, was thoughtful and persuasive. But Goldman still has a major PR problem.
First, it’s despised by reporters and legislators, not to mention investors who have seen its stock’s market value decline by 50% in a year. Its recently shown-the-door PR director was a notoriously haughty, close-mouthed Brit. And so now it falls to the firm’s new PR director, who ironically joined the firm the day Mr. Smith’s op-ed was published, to set about immediately to “humanize” his employer.
How?
My advice would be the “old-fashioned way,” by opening up management to the media. Blankfein, although you’d never know it from the reviews, is a personable and candid chief executive. He should be exposed regularly to print, broadcast and online journalists, to update the public on the firm’s views and actions. That’s what JPMorgan CEO Jamie Dimon does, and he’s a favorite of reporters and legislators.
A regular schedule of media interviews for its top executives will allow Goldman, over time, to shake its aura of aloofness and arrogance.
Stated another way, making Goldman Sachs more “approachable” will help mitigate the damage done by any future disgruntled former employee who seeks stardom by whining in public. |