I wish my grandmother were still alive to see it.
There it was, on the right hand side of the “c” section on Wednesday morning – yes, some of us still read the Wall Street Journal in paper form – an apology of wrongdoing and a commitment of time and funds by Goldman Sachs in an attempt to repair some of the damage. $100 million a year for five years, overseen by a panel headed by Warren Buffet. The apology? “We participated in things that were clearly wrong and have reason to regret. We apologize.” From Blankfein himself.
My grandmother taught me – “there will always be someone who is richer, and someone who is thinner.” The idea is that you can compare yourself to people and make yourself feel bad, but it’s kind of beside the point: in other words, envy is not attractive.
In the business world, that “someone” is Goldman Sachs. Hence the vitriol over the apology from Blankfein, and widespread scorn concerning the $500 million pledge to develop education and provide lending to small business people. We envy Goldman, and so we hate them.
So what is Goldman’s effort – a PR ploy or an honest attempt to make things right? Sincere or spin-cere? Are they taking a leadership position, or are they somehow throwing us a bone, laughing at us behind their backs?
I read this news story with interest, both from fascination with Goldman Sachs – the closest thing we have to landed gentry, the barons and baronesses of the United States – but also because of the blog post I wrote last week on renewing trust in our financial institutions. According to our client, Maritz, trust in financial institutions among average Americans has not only dropped in the past year, it has dropped significantly in the past six months. That’s demoralizing data.
But I have to say I was impressed and pleased with what they announced yesterday. It takes guts to say ‘I am sorry.’ If you don’t believe that, try it. Plus, they are backing that apology with the two most valuable assets they have – knowledge and capital. They are Goldman because they have – at least by reputation – all the money and most of the brains. But they are pledging those to help others.
The post last week articulates what financial institutions need to focus on to repair their reputations:
- A true understanding of how mad people are.
- Deeds before words. Concrete action in the areas of self-regulation, executive pay restraints and giving back to society that demonstrate that we’re all in this together.
- A willingness – very rare in this industry – to break from the pack and go beyond the norms of what other institutions will do. In other words, real leadership.
It concludes with a little advice: “Say something. Do something. You have little, at this point, to lose.” Goldman should be applauded for its effort to take a leadership position in the current environment. They are the alpha lion in the forest, and other institutions will take note of these actions. To whom more is given, more is required. Another thing my grandmother taught me.
Will people be interested in Goldman’s help? I think so. As of this writing, there are 37 comments already on the New York Times “You’re the boss” column titled “What Will the Goldman Sachs plan mean to you?” The comments are mostly from entrepreneurs who want and need capital and knowledge to get their businesses off the ground.
(photo by Tambako the Jaguar)
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