Categories: Credit Crunch / Trust and reputations / Zurich

16 November 2008

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Lunch with a guru

I’ve just had Sunday lunch of “Ravioli, suedafrikanische Scampi und weisser Curry” at the Kronenhalle bar in Zurich, haunt of Swiss bankers celebrating deals. The conversation turned to bankers and grovelling.

My billionaire lunch-partner admires the Miró and Picasso, Tinguely and Klee artworks that adorn the snooker-table green walls. Over the years he’s become my trusted local business confidant. He is strikingly unflashy, abhors PR, doesn’t own a computer, and made a fortune out of IT. He lives in a lake-side house that he does not own, but rents from what he calls one of his vehicles. He made me laugh telling how Yamaichi President Shohei Nozawa not only apologized when Hokkaido Takushoku Bank collapsed, but joined his other executives to bow in sorrow on national Japanese TV.

Earlier in the day my good friend Alan Brighty posted a comment on this blog saying western bankers were hiding behind their lawyers as they refused to bow their own heads. But the lawyer argument cuts no ice with me, and it cut none with my lunch partner.

The former CEO of UBS Peter Wuffli in Switzerland just let go his CHF12 million bonus. He wanted to show solidarity with the staff he left behind who are struggling to keep the bank afloat. Meanwhile, the former UBS chairman Marcel Ospel looks set to pocket his bonus regardless of the shame heaped upon him.

Before this major crisis, CEOs were queuing at the microphone to grovel when things went wrong. Now they are running for cover. They should not be allowed to get away with it. Their reputations are not our primary concern, though silence will damage them more than speaking up. It is the reputations of the businesses they run or ran and the system they represent that matters most. From that point of view, the risks of being seen to be spineless outweigh the risks of legal action.

Here’s part of a very insightful article on the subject from US Today by Del Jones:

Companies have found that heart-felt apologies can decrease the likelihood of lawsuits if they’re well crafted and don’t come off as “Sorry I got caught,” but express regret, assume responsibility and map out a plan to avoid repeating the offense, says Leslie Gaines-Ross, chief reputation strategist at public relations firm Weber Shandwick and a longtime student of apologies in crisis management.

Great apologies of the past
Past corporate apologies have come from JetBlue, Amazon, Nielsen, Seagate Technology, Sun Microsystems, Southwest Airlines, Texaco, Procter & Gamble, United Airlines, Ford Motor, Toshiba, Merck, Mattel, Taco Bell and Nike. Even Hank Paulson, now Treasury secretary and a key player in the global attempt at economic resuscitation, apologized to employees in 2003 when he was CEO of Goldman Sachs for implying that most of them were irrelevant to the firm’s success.”

Those with the time can read the full article. Those with less time might want to take a peek at Leslie Gaines-Ross’s blog, on which she campaigns for CEOs to apologise.

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