Goldman Sachs Enters the Culture Wars

As if Goldman Sachs wasn’t fighting public relations battles on enough fronts, the company’s CEO, Lloyd Blankfein, opened a new theatre when he appeared in a recent video for the Human Rights Campaign announcing his support for gay marriage. The move made headlines because public company heads rarely make pronouncements on cultural lightning rod issues. The fact that it came from a buttoned-down institution like Goldman Sachs that typically eschews attention made the story all the more surprising.

Top executives at public companies are in the unenviable position of knowing that private views, improperly displayed, can seriously damage their company’s reputation. Navigating the complicated relationship between private convictions and public relations involves matters of both conscience and business calculation. The goal of a listed company is to maximize shareholder value, yet business schools are also recognizing that business cannot be conducted in a vacuum and every issue that crosses an executive’s desk cannot be answered by analyzing its impact on the bottom line.

Whether Blankfein did the right thing is beyond the scope of this blog entry. (Lloyd and I differ on the relative merits of disclosing views on social issues while wearing our company hats). I will, however, ask three questions raised by Blankfein’s commercial debut.

1.    If Blankfein deserves praise for publicly supporting something he feels is ethically the right thing to do, should every CEO be encouraged to pick sides in politically charged issues where matters of conscience are involved for them?

2.    Should public pronouncements on controversial topics be reserved for times when taking a stand can accrue public relations benefits for the company, or should companies consider taking bolder positions on issues important to them, even if they carry the risk of backlash?

3.    Will Blankfein’s strategy of reaching out to groups typically ignored by Wall Street – like the gay community – reap business or political benefits for the firm? Or will it hurt the company’s standing among traditional allies and cause more harm than good?

Answering any of these questions would be a blog post – or more – by itself. They are important questions and I predict more companies will have to tackle them as opinionated younger generations, used to sharing their views freely over social media, begin to take over the C-suite.

What’s your view? Please take a moment to share your thoughts.

One Response to “Goldman Sachs Enters the Culture Wars”

  1. Fantastic post, Matt. As corporate responsibility became an increasingly important part of the business strategy, more firms have spoken out for causes that may put them in the middle of heated political debates. Regardless of our personal opinions on these issues, I think some firms are handling the political waters better than others. Social media and information accessibility has made it difficult for firms to avoid backlash when either the firm or an individual of a firm supports or decries a particular issue or institution. Firms that are transparent, authentic and consistent, and create multiple plans for the most likely outcomes, will fair best. It appears that Goldman Sachs has planned for this release and they are controlling the conversation–furthermore, the company itself is in line with Blankfein. It will be interesting to see if they continue to control the conversation and if other firms attempt to emulate this strategy.

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