Goldman Sachs is an incredibly special brand. Goldman is a clear industry leader, with a respected, admired and feared brand. People from Goldman are smart, tough and refined. If someone from Goldman gives you a ring, well, you will probably take the call.
But this is all changing. Goldman seems to be emerging as one of world’s most visible evil financial institutions. News this week that the Securities and Exchange Commission is charging Goldman Sachs with fraud hit home because it comes on top of simmering resentment. How has Goldman been making billions and billions when the U.S. government is going massively into debt, the U.S. worker struggles to avoid foreclosure and many financial firms topple? With the SEC’s complaint getting lots of press I’m sure many people will conclude the answer is now pretty obvious.
Goldman CEO Lloyd Blankfein’s efforts to defend Goldman this week do not seem to be helping. According to today’s Financial Times Blankfein is going on the offensive, defending the deal in question and claiming that the SEC’s move “hurts America.”
This is not the way to save the Goldman brand. Indeed, as soon as you start believing that your brand is so important that attacking it is bad for the country, you have lost touch with reality.
Instead, Blankfein should state that he is committed to discovering the truth. He should emphasize the fact that ethics are a top priority for Goldman, and if there was fraud, he wants to find it and address the problems. And he should do everything possible to reassure people that Goldman is an honest and respectable firm. Right now many people don’t believe this, and Goldman’s brand equity is falling fast.