It has been quite a week for apologies. Hedge fund supremo Bill Ackman expressed regret over his money-losing bet on J.C. Penney. Dan Doctoroff, CEO of Bloomberg, released the results of an independent review of its data security and editorial practices and pledged steps to strengthen both. But when it came to the week’s biggest failure – the trading blackout at Nasdaq – Bob Greifeld just couldn’t say the word.
This is as close as Mr. Greifeld – who is earning the nickname Blackout Bob – got to an apology, in an interview on CBC the morning after the snafu:
“We deeply are disappointed with what happened yesterday. We aspire for perfection, right? We want to get to 100 percent uptime. We didn’t get there yesterday. Obviously, that’s a problem. We had to continue on that quest. But it’s important to recognize that we have to have the ability to handle the situation properly when a problem arises. I can never commit to anybody that there will never be a problem. We have to commit to is (sic) we are going to work as hard as we can to get to 100 percent – and to the extent we can’t achieve perfection and there is an issue – that we have the proper procedures in place to respond to it. That’s what we did yesterday. We took our time understanding what the problem was. We resolved the problem and then we coordinated with the industry and came back in a logical, organized way. We are quite proud of the fact we had an orderly market close for the balance of the day.”
No apology there. Not even a very convincing statement about what happened and what Nasdaq is doing to prevent a recurrence of such problems.
Mr. Greifeld seems to be saying that, like an electric utility (LILCO comes to mind), bad stuff is going to happen every now and then at Nasdaq. The trouble is, Nasdaq’s problems happen rather frequently and, unlike the power company, there aren’t hurricanes to blame.
Nor does Mr. Greifeld believe he has an obligation to communicate to the public. He prefers to “coordinate with the industry” and strongly resists the idea of being more communicative, saying later in the interview:
“It’s not our job nor will it be to go on the press, to the press and the public while we focus on the issue.”
He really has taken a page from the LILCO crisis manual: Say nothing at all tot he public.
Viewers quickly objected to Mr. Greifeld’s blithe tolerance for the occasional blackout. His CNBC comments sparked a fury on twitter and critical news stories in major outlets the following day. The New York Times went so far as to say the exchange was “looking more like a vulnerable-also ran” after its trading mishap. Ouch.
The CNBC interview was a disaster for Mr. Greifeld from the start. He never had a clear message, never took control of the conversation and, worst of all, tossed out new revelations that did further damage to his already battered reputation.
We learned, for example, that Greifeld had not updated his board of directors on this matter. That’s a pretty shocking breakdown in governance.
Mr. Greifeld has shown a consistent aversion to communication whenever problems arise. He doesn’t seem to understand that the investing public has a real interest in seeing that Nasdaq operates efficiently, safely and securely. The board might understand that, however. So it soon could be the end of the road for Blackout Bob.