November 21st, 2008
It’s so appropriate that the phrase comes from the investment community – because said community really stinks at it!
I submit to you the following:
1. AIG using taxpayer money on sales retreats, replete with spa treatments. Then AIG used taxpayer money on deferred comp for the top 5% of its executives.
2. The CEOs of GM, Chrysler and Ford flying to Washington DC in private jets to plead for taxpayer money before a Congressional committee.
3. James Cayne, the former CEO of Bear Stearns, was busy playing bridge in Tennessee without a cell phone or Blackberry while the financial community struggled to save (or sell) his firm.
On the flip side – with good optics – is The Nielsen Company who just canceled its 2009 client meeting, citing economic concerns.
In times of significant oversight, the last thing an organization should do is something (anything) that would instantly be absorbed as inappropriate. And – suspending belief for a moment – even if the action is “legitimate” (a surprised AIG executive told me this past weekend that he could not understand how anyone wouldn’t understand the just cause of deferred comp), it is wholly irrelevant. Because even if you are “right” you won’t have the chance to prove it: the market will have passed judgment and moved on.
Poor optics – particularly those we’ve witnessed since the failure of Lehman Brothers – can be a symptom of two diseases. The first illness causes a historically successful individual to somehow believe that she is untouchable and, perhaps, even super-human. Just as troublesome is the disease that causes one to believe that anything he does might in fact be seen, but that the seers will determine the person’s true, positive intent and will defer.
Both illnesses bring down companies. As senior marketing executives frequently run PR/communications, we can only counsel senior management in their best interest but, too often, these voices are eventually silenced. Any CEO playing cards in Tennessee without a phone while the market is tanking is accustomed to such behavior, and is unlikely to accept advice to the contrary. And in that case, the potentially hundreds of thousands of employees, retirees and communities who rely on that organization better hope that the card game ends early.
A version of this post can be found at www.reputationgarage.com.
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