Goldman Sachs CEO Lloyd Blankfein has been giving many more interviews recently, in the wake of his testimony to a Senate committee last week regarding his firm’s role in the recent financial meltdown.
Goldman staffed up its PR counsel in advance of yesterday’s Senate hearings, which looked at the company’s role in the financial meltdown. Specifically, as ABC News reports:
The Securities and Exchange Commission brought fraud charges against Goldman this month and claimed that the company bet against its own clients and helped create the housing bubble that preceded the worst financial crisis since the Great Depression of the 1930s.
So far, it seems, people are not pleased with Goldman’s performance. Sean Cassidy, president of DKC — formerly Dan Klores Communications — told PRNewser:
I thought Goldman’s performance was absolutely terrible. From what I saw, I don’t think they defended their business practices at all… The executive testimony ranged from ludicrous, occasionally wishy-washy, denials that lacked credibility to an inability to answer seemingly basic questions. Overall they came across like rich guys who got caught.
What really frightens me in all of this is that it didn’t seem like a legal or PR strategy. It seemed like these Goldman executives genuinely had no ability to take a step back and make observations about the system in which they operate.
It is not at all surprising that Goldman is standing their ground on Capitol Hill. They have no choice. At the same time, however, PR needs to be part of their triage mode, working behind the scenes with third party groups and media to provide context around the business of their business. It is likely they have done nothing wrong, but that doesn’t matter. The operative issue here is that the general public, especially media and grandstanding politicians, don’t have a clue as to how the business works.
Goldman Sachs Chairman and CEO Lloyd Blankfeinappeared on ‘Good Morning America,’ today, in addition to other TV interviews. PRNewser’s weekly poll asks, “Will Goldman Sachs’ Words Do Anything To Change Your Perception of the Company?” Cast your vote here.
All eyes will be on Goldman Sachs today, as CEO Lloyd Blankfein and executive Fabrice Tourre, who was named in the SEC fraud charges currently being faced by the investment bank, appear for a Senate hearing.
Goldman has hiredMark Fabiani [pictured] of Fabiani and Lehane in recent weeks to boost its PR counsel. Fabiani and partner Chris Lehane were known as the “Masters of Disaster” for their crisis P.R. work when they worked for the Clinton White House and campaigns.
PR executives have continuouslydebated Goldman’s PR strategy. “If we’re talking about Goldman Sachs as a brand, they’re going to be fine. If we’re talking about Lloyd Blankfein, that’s a different story,” Robbie Vorhaus, CEO of Vorhaus Communications told CNBC late yesterday.
Robert Dillenschneider of The Dillenschneider Group said Blankfein “shouldn’t be combative” at the hearings today. More to come…
Former New Jersey Governor, Senator, and Goldman Sachs CEO Jon Corzine spent a long time on Bloomberg TV yesterday, discussing crises of the day including Toyota’s woes, Goldman’s image, and his own legacy.
When asked by the host about the “most vilified financial brand in history” Corzine elaborated on strategy, image, “ethos” and how you communicate, “there are always issues in how you explain.”
He also gave current CEO Lloyd Blankfein credit in the wake of the controversial “God’s work” comment, “Lloyd has done a much better job than the publicity surrounding him implies.”
“When you make an occasional mistake in public, it’s easy to misphrase something at the wrong time when you thought your toung was in cheek. Those type of things when people are extremely sensitive is extraordinary.”
On what Goldman should do now, “the best thing to do, kind of what the PR consultants said, speak a little less, do a lot to serve your shareholders and your clients…sticking to the knitting of the fundamentals of what your business is about is the way to try to meet those kinds of challenges that come from the public attack on the brand.”
At one point in time, it seemed as if every PR firm was jockeying to score what could be the biggest financial services account in all of the land: Goldman Sachs.
Today we learn that at least one firm is benefiting from Goldman’s image troubles. WPP-owned Public Stategies — led by Dan Bartlett, former counselor to President George W. Bush — has been hired by the firm, reports the New York Post.
The news likely could have leaked because Public Strategies issued a survey to Goldman clients and analysts who cover the company, asking them what they think of the firm.
Goldman Sachs announced today its “richest quarterly profit in the investment bank’s 140-year history,” according toThe Wall Street Journal.
Despite profits of $4.78 billion for Q4 2009 — more than JP Morgan, Merryl Lynch, Bank of America and Citigroup combined — the firm’s $16.2 billion in employee compensation was the “lowest ever compensation to net revenues ratio,” said CEO Lloyd Blankfein [pictured].
While $16 billion may be low for Goldman, it’s a fortune for anyone else. Will the move do anything to help the company’s reputation?
A Vanity Fair feature story, available online now, will hit newsstands nationally next week. In the story, one hedge-fund trader says of the firm, “It’s like the Mob who picks up the garbage…You pay their fees, because you need your garbage picked up.”
In a recent PRNewser poll, 62% of respondents said that the Goldman’s recent actions have not changed their perception of the company.
UPDATE: We’ve added the above chart from YouGov’s BrandIndex. The survey interviews 5,000 people each weekday from a representative US population sample. A score can range from 100 to -100 and is compiled by subtracting negative feedback from positive. A zero score means equal positive and negative feedback. Margin of error is +/- 2%.
“Some people come in and say, ‘You are doing too much. Don’t say another word.’ Other people say we should get on the talk shows,” said Goldman Sachs CEO Lloyd Blankfein at an event in Manhattan last week.
Blankfein was referring of course to the mixed advice his company is receiving from a litany of PR experts and agency heads eager to boost their revenue with a few high profile financial services accounts.
Earlier today we reported on investment bank Goldman Sachs’ new initiative to invest $500 million into 10,000 U.S. small businesses. The moves comes on the heals of the first ever public apology from CEO Lloyd Blankfein for Goldman’s role in the financial troubles of the last year and a half. “We participated in things that were clearly wrong and have reason to regret…We apologize,” he said at a conference in New York.
Our question: does the $500m initiative and public apology give you a better perception of the company? Does it change public sentiment, or will it be seen more as just a PR move?