He didn’t really say that, did he? Clients are known as “muppets”? And “if you make enough money for the firm (and are not currently an ax murderer) you will be promoted into a position of influence”? And the firm he represented a dozen years has “lost its moral fiber”? With a culture that is “toxic and destructive”? And you can become a leader “by persuading your clients to invest in the stocks or other products that we are trying to get rid of because they are not seen as having a lot of potential profit…”? Talk about a public relations nightmare on top of a public relations fiasco at Goldman Sachs.
Greg Smith, A 33-year-old London-based vice president, created a different kind of trading frenzy on Wall Street yesterday with a very public –- and j’accusatory –- resignation in the op-ed pages of the New York Times titled, “Why I Am Leaving Goldman Sachs.” Opinions on the veracity of what he claimed, and whether he was brave, foolish or just plain indiscreet and self-indulgent in saying it, should have sent Poland Spring sales through the roof, what with all the water-cooler talk, tweeting and emailing that has ensued.
Reuters informs us, by the way, that “in the United States ‘muppet’ brings to mind lovable puppets like Kermit the Frog, but in Britain, ‘muppet’ is slang for a stupid person,” and then, with a great sense of parenthetical irony: “(Goldman, as it happens, was at one time also the bank for the family of Muppets creator Jim Henson.)”
The Wall Street Journal was all over the story, including a live chat yesterday afternoon between readers and crisis communications expert Robert Dilenschneider. The Dilenschneider Group honcho opened by reframing a question that inquired about whether there are “moral issues inherent in the field of corporate advisory” thusly:
“The real question is: How did Smith do his job? How was he treated by other partners? How ethical is Goldman? How ethical is the financial services industry? Do they care about their shareholders, employees? These are the questions being raised. Goldman needs to demonstrate they care about shareholders and employees.”
The bottom line was that chairman and CEO Lloyd C. Blankfein and his colleagues at the top needed to address the issue “head-on.” They did, of course, attempt to do just that. The most frequently emailed story in the Journal this morning is “Goldman Rejects Claims Made by Outgoing Executive.”
“We disagree with the views expressed, which we don’t think reflect the way we run our business,” a Goldman spokeswoman says. “In our view, we will only be successful if our clients are successful. This fundamental truth lies at the heart of how we conduct ourselves.”
“In a company of our size, it is not shocking that some people could feel disgruntled. But that does not and should not represent our firm of more than 30,000 people,” Blankfein and president and COO Gary D. Cohn write in a lengthy memo to employees. “Everyone is entitled to his or her opinion. But, it is unfortunate that an individual opinion about Goldman Sachs is amplified in a newspaper and speaks louder than the regular, detailed and intensive feedback you have provided the firm and independent, public surveys of workplace environments.”
The Times itself followed up with several pieces –- one spreading the culpability a little by revealing the pet names that toilers in other vineyards have concocted for their customers (flight attendants call infrequent leisure fliers “Clampetts,” for example, and “advertising executives call people ‘bobbleheads’ if they approve of everything a boss says or does,” Julie Creswell informs us.
In the Times’ main piece – “Public Rebuke of Culture at Goldman Opens Debate” -- Susanne Craig and Landon Thomas Jr. write that “some within Goldman sought to portray Mr. Smith as a lone wolf -- he did not manage anyone -- who had failed to become a managing director. (There are about 12,000 executive directors, the equivalent of being a vice president in the United States, but only about 2,500 managing directors among Goldman’s 33,300 employees.)”
That’s one way to spin it, but other colleagues say Smith is as “a quiet, hard worker who didn't complain openly about life at the firm or how it treated clients,” the Wall Street Journal reports in its lead story by David Enrich and Liz Rappaport. Reuters India tracks down the former headmaster at Smith’s high school in South Africa, who says Smith was “a remarkable young man, exceptionally intelligent with an integrity that is probably unequalled.”
The International Business Times’ Michael Billera recounts some representative postings from all sides of the issue on Facebook and Twitter, reporting that “#GoldmanSachs and #GregSmith quickly began trending on Twitter nationwide.” Here’s one observation of some relevance to this audience: "Greg Smith, Goldman Sachs letter = Don Draper, Tobacco clients letter," tweeted Meg Fowler Tripp.
Indeed, Forbes auto blogger Micheline Maynard writes an exigesis around the conceit with a deconstruction of the language used in each screed. She concludes: “The playwright Tom Stoppard says, ‘I think theater ought to be theatrical.’ And as it turns out, resigning from Goldman Sachs can be, too.”
Yes, but have we just watched a searing satire or an overplayed melodrama?
The bottom line being the bottom line, Bloomberg News sums up the early reviews: “Goldman Roiled by Op-Ed Loses $2.2 Billion.”