Compliance &Ethics - Society of Corporate Compliance and Ethics

Boehme of Contentionby Donna BoehmeGoldman Sachs. Culture.Muppets. Talk amongstyourselves.BoehmeYou’ve got to feel pretty bad for theGoldman Sachs PR folks, who probablyspit out their sips of triple soyvanilla latte in unison as they turned ontheir iPads to former exec Greg Smith’sexplosive take-this-job-and-shove-it resignationin the form of a New York Timesop-ed. On the other hand, what aperfect made-for-TV movie for thoseof us in the compliance and ethicspeanut gallery. You really can’tmake this stuff up.If you haven’t read Smith’s scathingop-ed, “Why I Am LeavingGoldman Sachs,” publicly rebuking the firmfor its “toxic culture” and alleging that execsroutinely referred to their clients as “muppets”(British slang for “idiots”—where have youbeen?), here it is. Go ahead, we’ll wait: www.nytimes.com/2012/03/14/opinion/why-i-am-leaving-goldman-sachs.htmlAlthough Goldman, as expected, has vigorouslyrefuted the claims (again, PR peopleworking overtime), this comes at a time whenWall Street firms are under fire for theirgreedy, risk-taking culture that may or maynot have led to the financial meltdown, andplays right into the hands of those who arguefor more—not less—regulation. For the purposeof our discussion here, I’m not votingeither way. For the moment, let’s just file theseobservations under the category of “TheThings We Think and Do Not Say.”Observation #1: Circle-the-wagons syndrome.Anyone following the speed of Wall Streetcircling the wagons could get a bad case ofwhiplash. Connect the dots to Bloomberg’sugly editorial excoriation of Smith himself thenext day. www.bloomberg.com/news/2012-03-14/yes-mr-smith-goldman-sachs-is-all-about-makingmoney-view.htmlObservation #2: Society still hates snitches.Forget firm culture; as a society, we stillrecoil when people get out of line and speakup. That’s why Satan created retaliation.Goldman’s counter-attack on Smith was swiftand continues. In my networks, I’m watchingmany who are usually happy to talk about“tone at the top” and “transparency” backaway from this one.Observation #3: The CCO’s fairy tale rarelycomes true.The former CCO in me wants to believeGoldman will take Smith’s criticisms to heartand engage their employees in an open dialogueabout ethical culture. But I know thechances of that, to quote my all-time favoriteE*Trade talking-baby commercial, “are the sameas being mauled by a polar bear and a regularbear in the same day.” www.youtube.com/watch?v=HqVBKO_QM3oAnd that’s my two cents. Now, go and talkamongst yourselves! ✵Send comments to Donna Boehme at dboehme@compliancestrategists.com.Compliance & Ethics Professional May/June 2012+1 952 933 4977 or 888 277 4977 | www.corporatecompliance.org 21