A little overdue now but a couple of weeks ago PR News asked me to contribute to its 'Advisor' column on the question of Goldman Sach's bonuses. The exact question was:As Goldman Sachs prepares to announce its final compensation pool and bonuses, how well are they reacting to the public sentiment, and what could they do differently?

My answer, published in last week's issue was:

"Thanks to its niche client base, Goldman Sachs has traditionally managed to avoid proactive engagement with the wider world, a strategy that served it well until recently. But times have changed irrevocably and the public can now exert a much greater influence via heavy-handed regulators and even, as reported recently, through direct threats against the firm's employees. Clearly something needs to change. 

Goldman has had 18 months to roll out a holistic PR strategy but teaching an old dog new tricks has been difficult. The steps Goldman has taken recently have been the right ones: trumpeting the firm's philanthropic efforts, engaging in a new $500m small business initiative and converting a greater percentage of its cash bonuses to equity. Unfortunately, not having had an established platform of engagement in place, many of these knee-jerk moves are falling on deaf ears or being dismissed as gimmicks. Goldman is a cautionary tale on the value of building long rather than short-term relationships with the public.

If we are to avoid the kind of populist 50% bonus tax currently being levied in Europe, Goldman and other investment banks are going to need to fundamentally rethink their engagement strategy."

The event kick-started with a short survey of the attending bankers and corporates, which generated some interesting feedback.  The poll allowed delegates to share their opinions on a variety of areas, including the severity of the crisis, bonuses and their main concerns moving into 2010.

The programme contained a whole series of high calibre speakers including treasury heads from Microsoft, Motorola and AstraZeneca, and other panellists from J.P. Morgan and Bank of America. Some of the key topics discussed were liquidity management, fair value accounting and eliminating settlement risk. During the event, EuroFinance also launched their own ‘Financial Fairytales' - a collection of short stories that use the crisis to re-interpret the classical works of Hans Christian Andersen.

Pres. Obama announces caps on executive pay-outs among banks seeking government help though the details of who exactly qualifies for this punishment seem a little vague at this stage. Could the financial industry headed this off at the pass with an effective communications campaign and early internal reforms? Some argue so...

In  other news are the wheels already coming off the Obama communications machine? With money and the economy at the forefront of everyone's mind now is not the time for tax issues to bedevil you and senior economic advisors to get in to a turf war, surely?