The top 38 firms are on pace to award $145 Billion in bonuses for 2009, up 18% from 2008, and just over the all-time high set for bonuses in 2007. Goldman Sachs’ part of this bonus pool is roughly $700,000 per employee.
While most of us are struggling to keep our job and pay our mortgages, it’s easy to get angry at the executives who run these companies. Here’s the tough pill to swallow–Wall Street is one of the largest, most successful industries in this country, as well as the entire world. It employs 150 Million Americans, and is 20% of our GDP. Despite what politically motivated individuals think, Wall Street and Main Street need each other and it’s in our economic and national interest to make sure that it continues to flourish here in America.
Wall Street has started to be more vocal. Morgan Stanley’s Chief Executive made a statement saying, “I do think the behavior is improper. We regret the consequence that people have lost money in it.” The banks that received bail out money seconded this sentiment when they met in front of the Financial Crises Commission, last week. However, the same executive later defended the firm’s actions as “exercises in risk management.” Do they really get it? Is it too little, too late? I believe it’s never too late, and here are three strategies I would get started on straight away:
First. Explain what you do.
Admittedly, we the general public, do not completely understand what or how you do what you do. Most of us were brought up believing, “If you can’t explain it, you can’t trust it.” Please, explain in layman’s terms how the financial system works, your role and the significance it has on our life, so that we can all have that ‘Aha’ moment.
Second. Put a face to the industry.
Unfortunately for Wall Street, most Americans imagine it being run by characters like Gordon Gecko, walking around in wingtip shoes and six thousand dollar suits, slapping each other on the backs saying, “Greed is Good”—with nothing but self interest and short term profits as the status quo. How about replacing this image with real people, real families, and real values.
Third. Communicate your values sincerely.
For the most part, Wall Street’s image problem is self inflicted with much of the after-the-fact Public Relations seeming disingenuous. Press conferences, news media, and weekend talk shows are a start, but more is needed. Why not rally the entire financial community, and publicly sign a code of conduct with ethics and values that the industry will hold themselves responsible for, and show how you plan to enforce it.
If there’s a lesson to learn here, it’s that the best time for a communications program, is before you need it. The damage caused will take Wall Street years if not decades to rectify and cost untold amounts of money and time. Perhaps, if they adopt a sincere, coordinated and creative communications program, Wall Street will be able to turn the tide of public opinion. Lets hope so, for the future of this vital American industry.