How to Take On A Media Giant

 How to Take On A Media Giant A golden rule of corporate PR? Threatening to sue a newspaper or media outlet is a waste of time. Even trying to intimidate through an endless volley of legal letters usually backfires. Unless you can call out a media outlet on its polices and procedures, complaining about perceived unfairness usually falls on deaf and everlastingly hostile ears. Which is why Bloomberg’s recent misstep with Goldman Sachs makes interesting reading.

Bloomberg, a robust news organization, prides itself on high standards and journalist integrity, but is now wiping egg from its face following the admission and subsequent apology that its journalists had access to certain client information from its terminals ubiquitous on every trading floor. This included user’s login information and other general details including help desk inquiries. Bloomberg issued a quick apology and swiftly announced changes in procedure. It has since stressed that at no time did reporters have access to trading and monitoring systems or to clients’ messages to one another (the stuff that really matters).

When Goldman Sachs, routinely held accountable in the public eye, discovered that its employees were being monitored by Bloomberg journalists with access to private data, a formal complaint was made. This must have the been the gotcha moment. No news organization likes to be accused of an ethical breach and this was one case where Goldman could flex its own muscle and claim the moral high ground.

The PR Verdict:  “A” for Goldman Sachs for scoring a public and ethical win.

The PR Takeaway:  Integrity is the Achilles’ heel. No doubt Goldman Sachs has previously had its fair share of battles with Bloomberg but complaining to news organizations about bias and unfairness rarely works. This time it was different. A bruised eye for a leading news organization and a PR point for Goldman Sachs for starting a news cycle debate about journalist integrity.  When there is a breach of procedure any PR is on firm ground to go ahead and complain. Choose your battles wisely.

 

Why He Left Goldman Sachs, and Why They’re Not Worried

 Why He Left Goldman Sachs, and Why Theyre Not Worried

The PR Verdict: “B” (Good Show) to Goldman Sachs.

Breakups are never easy, and today sees the publication of a very long breakup letter. Why I Left Goldman Sachs: A Wall Street Story is a memoir written by former Goldman employee Greg Smith. It follows up on Smith’s poison pen editorial of the same name, published in The New York Times in early March 2012. The consensus? Goldman Sachs’ board members can sleep easy.

Greg Smith used to be in equity derivatives sales. In upper management, he earned a more than respectable living of around $500k. Disillusioned by the alleged cynicism and hypocrisy of a culture that did not put clients first (supposedly referring to them as “Muppets”), Smith became more and more disenchanted, so goes his narrative, until one day the moral bankruptcy of the firm caused him to quit.

With Smith receiving a reported $1.5 million book advance for a memoir about his time at the firm, Goldman Sachs was presumably worried. But his former employer is now indicating that Smith’s memoirs are not as damaging as originally expected. Some of his reminiscences may not be pretty, but there’s nothing illegal or that surprising about them. As for Smith’s credibility, it seems GS has had its own well-executed PR plan to raise a cloud over their ex-employee’s widely reported griping.

The PR Verdict: “B” (Good Show) for Goldman Sachs’s softly-softly response in advance of publication.

The PR Takeaway:  Say what you need to say once, and then let others do the talking. In advance of Smith’s book launch, Goldman Sachs made available its 18-page internal report on Smith’s allegations to newswire Bloomberg.  The report reveals that prior to resigning, Smith allegedly wanted a 100 percent pay raise, was denied a promotion, and may not have been long for the firm. The report’s contents were widely repeated – not by GS, but by the media. The nagging doubt is now that Smith may have just been a disgruntled employee. No on the record comment from Goldman Sachs, but a volte face from the very media that covered the story in the first place. Now that’s effective PR.

To read more click here.

What’s your opinion of Greg Smith’s book, and Goldman Sachs’s response? Give us your PR Verdict!

Would You Call Yourself a Close Friend of Rajat Gupta?

rajat gupta Would You Call Yourself a Close Friend of Rajat Gupta?

The PR Verdict: “B” for Rajat Gupta and friends

For those who missed it, yesterday was day one of the trial of Rajat Gupta the former managing director of McKinsey & Company and former board member of Goldman Sachs.  He is charged with passing on secret tips to convicted hedge funder Raj Rajaratnam who is now serving a lengthy sentence for insider dealing.  Gupta is accused of leaking price sensitive information to Rajaratnam about Goldman Sachs and Procter & Gamble.

Not everyone agrees.  Gupta’s attorneys describe him as a man of “great integrity,” a philanthropist and a victim of prosecutorial overreach.  As part of his PR campaign Gupta’s friends have rallied a high flying list of supporters who point to his social, civic and business record.  Author Deepak Chopra and one of India’s richest men are among those who have signed an open letter defending Gupta’s record at a website simply called www.friendsofrajat.com,

“He’s like a dolphin caught up in a tuna net,” says a high powered friend who manages the website. “The government refuses to admit it’s a dolphin and not a big fat tuna, and they’re not going to give up. That’s what my website is trying to do, tell the story about the other Rajat.”  Friends have turned out in force but are they the right ones?

The PR Verdict: “B” for Rajat Gupta and his friends.  They have made their case well, arguing they want to counterbalance negative prejudicial coverage by presenting a fuller version of Gupta’s business pedigree.  Next time why not find a move diverse group of supporters?

The PR Takeaway:  Diversity broadens reach and lowers risk.  For a man steeped in the business affairs of corporate America it is surprising how few non-south Asian names have signed the letter.  The insider-dealing network of convicted Raj Rajaratnam was partly based on a series of close ties with people who shared the same cultural background.  A few more non-Indian names from big-shot corporate America might have improved the chances of providing Gupta the air cover and distance from the Rajaratnam case that his well meaning friends have stepped in to provide.

 

 

Why Else Would You Work On Wall Street?

nyse 300x225 Why Else Would You Work On Wall Street?

The PR Verdict: “D” for Wall Street and its lack of creativity in generating compelling reasons to work there.

It’s been almost a week since disgruntled Goldman’s employee Greg Smith penned his NYTimes op-ed on his former employer. The fallout continues.  Multiple articles have appeared questioning the future of Wall Street.  Have graduates lost interest in applying?  Are current employees reconsidering career choices as they look at their shrunken bonus checks?

On the other hand, James Gorman CEO of Morgan Stanley told Fortune that when he spoke recently at Wharton Business School there were two overflow rooms of students eager to apply.  He added that only two managing directors, out of a total of 1800, had resigned since shrunken bonuses were paid.

Who to believe?

Whatever the truth, this discussion is ALWAYS about compensation and nothing else.  It’s as if Wall Street’s management is unable to find any other reason to work there.  Stuck in a PR maze, management is unable to articulate compelling alternative incentives apart from financial remuneration.

The PR Verdict: “D” for Wall Street and its lack of creativity in generating compelling reasons to work there.  No wonder the industry’s image is stuck in a negative spiral.

By solely focusing on compensation there is little hope of changing the ongoing conversation.  There are many careers that sing their praises on benefits and values which have nothing to do with compensation. Wall Street’s  HR departments and management committees might want to look to them for some much needed inspiration.

To read the article in Fortune click here. To read about how Wall Street is losing its appeal click here.

What’s your PR verdict on how Wall Street sells itself as a career choice?

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Why I Am STAYING With Goldman Sachs

quit Why I Am STAYING With Goldman Sachs

The PR Verdict: “B” for Goldman for a sensible response.

There was no basket of muffins, let alone an apple waiting on the desk for the newly appointed head of PR at Goldman Sachs, Jake Siewert on his first day yesterday.  Instead he was greeted with a big fat op-ed in the New York Times, written by resigning employee, Greg Smith, provocatively called Why I Am leaving Goldman Sachs.

The article was remarkable for its candor.  Citing an ongoing malaise and dysfunction within the firm, Smith described Goldman as “toxic” with a cultural bias that has Goldman routinely prioritising profits over  clients.   The article has created a huge amount of noise in both mainstream and social media.

Goldman’s defence was simple;  without putting clients first, the business would not exist.  Rather than take him on publicly, an internal staff memo was issued and leaked to the media.  The memo referred to the latest statistics on Goldman employee satisfaction and concluded that it was  aware that it didn’t get everything always right.  In so doing, it took some of the force out of Smith’s more generalised complaints.

The PR Verdict: “B” for Goldman for a sensible reply designed to defuse the situation on day one.  But what might be the best PR answer to counter Smith and show employees and clients that he got it wrong over the next week or so?

If the heat continues and internally there is a perception that the firm has not taken a tough enough stand, how about asking the NYTimes for a right of reply?  Submit an op-ed by a client  or employee called Why I have STAYED with Goldman Sachs answering directly some of the issues raised by Smith.  Even better, make it from someone connected to Smith’s ex-business, equity derivatives.  The power of the cuttings archive is undisputed and without a response, Smith’s op-ed will have the last say.  Goldman’s might want to call on friends for an alternative view.

To read the op-ed click here and to read more about the Goldman memo click here

What’s your verdict on how Goldman have handled this issue:

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Al Gore, Sustainable Capitalism and Thought Leadership

Al GORE Al Gore, Sustainable Capitalism and Thought Leadership

The PR Verdict: "A" for Al Gore and the launch of "Sustainable Capitalism".

Al Gore, former Vice President and environmentalist, is in the news. He hit the headlines following the launch earlier this week of a white paper and 5-point manifesto for what he calls “Sustainable Capitalism”.

The manifesto is published by the non-profit arm of a fund-management company Gore launched with an ex Goldman Sachs partner. The asset manager, Generation Investment Management, focuses on investing in firms with “sustainable” business models.

Gore in interviews discussing the manifesto, identified five practical steps towards a model of capitalism that minimises short-termism. Abolishing quarterly reporting is the most straightforward, while creating “loyalty shares” that pay out more to investors the longer they keep them, is a novel idea and sure to provoke debate.

The PR Verdict: “A” for the launch of sustainable capitalism by Al Gore and his business partners.  This was a classic and well-executed PR “thought leadership” launch.

The roadmap  for “thought leadership” launches is well established but not always easy to execute.  First, begin by framing the ideas as suggestions only.  The purpose of any white paper is to initiate discussion and not be overly prescriptive. Secondly, identify simple practical suggestions (in this case five potential reforms) and provide some surprising supporting facts (e.g. the average holding period for a share is now seven months, down from several years in the 1990s). Finally, to maximise the headlines, have someone who is authoritative in the field as your presenting front-man (or woman).

As far as textbook examples go, of how to plot a successful launch in the “thought leadership” space, this was hard to beat.

To read more click here.

Goldman Sachs, Marriage Equality and Atypical Advocates

BlankfeinMarriage1 300x205 Goldman Sachs, Marriage Equality and Atypical Advocates

THE PR VERDICT: "B" for HRC and Blankfein

Lloyd Blankfein, CEO of Goldman Sachs, surprised everyone yesterday with his decision to become the first national corporate spokesman for same sex marriage. He has teamed up with Human Rights Campaign (HRC), a national advocacy organization that promotes LGBT rights.

HRC reasons that their unlikely spokesperson will demonstrate the diversity of Americans rallying around this issue. A neat and clever idea.

The NYTimes gave the news a big splash and HRC issued a video with Blankfein impressively declaring that equality is “good business and is the right thing to do”.  This PR strategy works on all fronts and incidentally helps correct Blankfein’s image as the Gotham villain in the financial crisis.

The PR Verdict: “B” for HRC and Blankfein.  This is an impressive PR strategy that changes the conversation and widens the supporter base from the predictable liberal, creative, establishment.

Blankfein should avoid responding with “no comment” as he gave the NYTimes and share personal thoughts about why he is doing this. “Good for business” is a sensible rallying cry but coming from an industry that has been demonized of late, wider more personal observations will kick this campaign into high gear.

Video below :

Lloyd Blankfein on Marriage Equality – HRC