Buffett disappoints, Transocean self-congratulates
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Buffett disappoints, Transocean self-congratulates

Paul Holmes

  • Twenty years ago, back when Warren Buffett was helping Salomon Brothers recover from scandal, he won a lot of admirers in the public relations community with his pronouncement that: “If you lose money for the firm by bad decisions, I will be very understanding. If you lose reputation for the firm I will be ruthless.” So it is with some sadness that I have to agree with New York Times op-ed columnist Joe Nocera that Buffett’s response to a new insider trading scandal at Berkshire Hathaway is disappointing, particularly his statement that: ““Neither Dave nor I feel his Lubrizol purchases were in any way unlawful.” Because lawful or not, Dave Sokol’s actions have been damaging to Berkshire Hathaway’s reputation—and to Buffett’s too. 
  • It looks like BP isn’t the only company that thinks self-congratulation is the appropriate response to the most disastrous oil spill in the history of man. Executives at Transocean, the company that was responsible for running the Deepwater Horizon rig that pumped millions of gallons of oil into the Gulf of Mexico, have just awarded themselves generous safety bonuses related to the company’s environmental safety performance. Which is kind of like giving the security guards at the Ford’s Theater a bonus because apart from that little incident involving President Lincoln the night went off without a hitch.
  • Via Waggener Edstrom’s Michele Clarke, it is clear that at least some shareholders are interested in reining in outlandish executive pay, which is interesting and encouraging. But the most interesting thing about the article in question is its summary of the argument against giving shareholders the right to vote on that issue. “They said shareholders weren’t sophisticated enough to understand the complexities of executive compensation.” It’s hard to imagine a clearer case of the “you must trust us, but we don’t trust you” mindset.
  • The Harvard Business Review is paying a little more attention to public relations topics there days (see this piece by Leslie Gaines-Ross), but it’s still quite an achievement for a PR person to be published there, so congratulations to Joan Schneider of Boston’s Schneider Associates for this article on why most product launches fail. Apart from anything else, it demonstrates the potential benefit of taking a smallish consumer PR firm and becoming known for one thing: in this case, launch PR.
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