Corporate Case Study: Cantor rebuilds its reputation amid media scrutiny

Widely known as the company that lost hundreds of staff in the World Trade Center attacks, Cantor Fitzgerald has spent the past three years balancing its tragic past with its bright future.

Widely known as the company that lost hundreds of staff in the World Trade Center attacks, Cantor Fitzgerald has spent the past three years balancing its tragic past with its bright future.

Following the terrorist attacks of 9/11, Cantor Fitzgerald became known as the company that lost almost 700 people, or two-thirds of its staff, at New York's World Trade Center. Then the financial services firm almost became known as the company that cared only about making money. On September 13, 2001, Cantor CEO Howard Lutnick addressed, in tears, a national television audience when he spoke to journalist Connie Chung about the tragedy, including losing his own brother in the attacks. Two days later, Cantor stopped paying the salaries of the 658 lost employees, even before families had digested that their loved ones were actually gone. At least one Cantor widow told the media that Lutnick's tears were phony because he had not spoken with her or attended her husband's funeral. Stopping the paychecks was said to be critical for Cantor to maintain cash flow, but the negative publicity illustrated to the company how sensitive it would need to be in communicating after such a horrific and public event. "They made some missteps and some comments in the public sector that had a very negative impact on their reputation," says Aaron Kwittken, CEO of Euro RSCG Magnet in New York, which began working with Cantor in April 2003. Cantor had worked with Edelman until January 2002. The company also worked with Dan Klores Communications from October 2001 to October 2003, to better communicate with families of employees who died in the terrorist attacks. "The lesson learned for Cantor at the time is that they were managing a tragedy that was very private, but through the lens of the media and public. Every step they made was going to be scrutinized under a microscope." Yet Cantor has not only survived that misstep, but flourished under the intense media spotlight. Today, it has grown to 1,850 employees and expects to hire 200 more over the next couple years, exceeding the staff count it had before 9/11. And eSpeed, Cantor's publicly traded subsidiary and electronic bond-trading operations, is profitable. That has helped Cantor make good on a promise to donate 25% of its profits until 2006 to families of the employees lost on 9/11. Since September 11, 2004, $147 million has been given to the families, with roughly $85 million of that from profits. The road to recovery It hasn't been easy for Cantor's communications department. Five employees of its then 10-person PR team died in the 9/11 attacks. Cara Kiewel, VP of PR in Europe and Asia, handled much of the initial media requests - from the US and worldwide - from Cantor's office in London. Amy Nauiokas, former SVP and director of marketing communications, set up an emergency outpost at her home in New York with the five surviving coworkers. "We were only accustomed to being read about in the business section" of the newspaper, says Kiewel. "It was a whole different kind of media relations: the news cycle. Business-to-business companies are in the news, but we weren't one of them. It was learning how to be the news instead of generating reasons for people to write about you, like the traditional, proactive PR campaign." Just over three years later, the communications team is facing another daunting challenge. Although executives know Cantor can't completely separate its identity from 9/11, the team is aiming to focus on the firm's suddenly expanding business story. Cantor is increasing its investment banking and asset management services. In doing so, this October it spun off its inter-dealer voice brokerage business with the creation of BGC Partners. "September 11 will always be a tragic part of our history that has undeniably shaped this company, but it is important that we not allow it to define us," says David Messina, associate VP of marketing and communications, for Cantor's New York office. "The spinoff of BGC Partners gives us a unique opportunity in the US to refocus our press strategy and reintroduce Cantor Fitzgerald to the financial public." To help do that, Cantor is reorganizing and rebuilding its communications team. Not only did Cantor lose senior communications staff in the attacks, it has also lost key people more recently to other firms - Nauiokas, for example, left earlier this year to join Barclays Capital. But Cantor made a key hire when it named Michael Geller director of media relations. Geller, who will focus on strengthening relationships with the media for eSpeed, previously served as PR manager for the financial institutions group at Moody's Investor Services. While Messina says Cantor doesn't want to be defined by 9/11, the initial strategy was to focus on nothing but. Kiewel says "talking about our business and Cantor's diversification had to wait" following 9/11. Instead, the messaging focused on Lutnick's commitment to donate 25% of profits to a family relief fund for five years. Initially, the media seemed skeptical that Lutnick, known in financial circles to be ruthlessly competitive, would make good on his promise. Kiewel admits "it was very disconcerting" to hear early on that some families were unhappy with Cantor. But by focusing on that unwavering commitment to the families over the long haul rather than offering a short-term solution, she says those families (and thus, the press) eventually understood what Cantor was trying to do. "That had to be the strategy in the beginning, which was to look after the families," says Kiewel. "I find that if you say you're going to do something and stick with it, the media will recognize what you have done." "The communications challenge was this: We couldn't make good on Howard's commitment a year later. It takes time," says Kwittken. "So what we did was identify milestones along the way to communicate to the press that the business was growing, which meant that we were also working toward our commitment to the family. The reason they are inextricably linked is because 25% of nothing is nothing." Looking ahead That drive and dedication helps explain why Cantor enjoys positive media coverage today. The headline on the cover of The New York Times business section on September 10, 2004 read, "Firm that was hit hard on 9/11 grows anew." The story includes interviews with relatives of former Cantor employees lost in 9/11, all of whom praise Lutnick. One father whose son died while working for Cantor is quoted saying, "A lot of people did have doubts. But Howard has really gone to bat for these families." The positive press is, in part, credited to the fact Cantor worked closely with media it felt would speak fairly and sensitively about its situation. "Our advice going in was don't accept every media interview. We looked back at how the media covered the company, and we tried to make a differentiation of which outlets and which reporters had a more balanced, accurate, and fair view of Cantor," says Kwittken. "Our strategy was fewer and better outlets that had a lot of credibility, such as CNN." He added that it also helped Cantor avoid looking like a corporate opportunist. That proved especially important during the anniversaries of 9/11, when Cantor was besieged with media requests. While it might appear opportunistic if Lutnick accepted every interview, Cantor didn't want to lose the opportunity to communicate that the company was succeeding. Magnet produced a VNR, in which Lutnick answered questions that the media would want answered, including tough issues such as the 9/11 commission. This past September, Lutnick participated in a few live broadcast interviews with CNBC's Kudlow & Cramer, CNN's In the Money, and the BBC. As Cantor diversifies its services, and eSpeed and BGC Partners grow their respective brands, the company known for losing the most staff in 9/11 is looking to tell the next chapter of its story. Cantor plans to do that by broadening its use of spokespeople and expanding its PR department. "Our recovery in the US has been strong over the past three years," says Messina. "It is an exciting time to tell the story of our evolving business strategy and plans for growth." PR contacts Corporate communications manager Kimberly Henneforth VP of PR (Europe and Asia) Cara Kiewel Associate VP of marketing and communications David Messina eSpeed director of media relations Michael Geller PR agency Euro RSCG Magnet

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.