On Wednesday, the Dow crept over 10,000 for the first time in more than a year. That same day, JP Morgan Chase announced a third-quarter profit of $3.6 billion. And Goldman Sachs, which received a taxpayer bailout last year, is on track to pay out record bonuses this year. It's like déjà vu all over again.
Yet despite some signs of economic improvement, one thing has remained the same: consumer skepticism. Big business still has a serious trust issue to overcome, something that is sure to last well into the future unless companies take serious steps to earn it back.
According to The New York Times, there are rumors on Wall Street that Goldman may increase its donations to charity, perhaps as much as up to $1 billion, in an effort to “defuse public resentment toward the bank.” While certainly an admirable move, it unfortunately is a transparent one as well. Instead of just throwing money at charities to quiet its naysayers, Goldman would be better served to launch a true CSR or cause marketing campaign that could engage the public, involve its employees, and have a lasting halo effect on its reputation.
Much of the argument for the outrageous bonuses of years past in the financial industry is that these are people that have worked extremely hard, have a deep knowledge of what they do, and deserve to be rewarded. Why not then put these hard-working and talented individuals front and center as part of a cause-related financial education campaign? It would put a more human face on an industry that the average American has trouble connecting with and offer real solutions to the most serious financial problems. That is something that would resonate with average consumers far more than an astronomical donation to charity.
Merely throwing around their financial heft is not the answer for companies that are thriving in this recovering economy. Using that success, and those responsible for it, to help reach a broader audience with an applicable message is what could make the difference in shifting public perception and reputation.