Wells defends spending on employee 'recognition events'
Wells Fargo & Co. today came out swinging against critics of the bank's spending on corporate events to recognize top employees.
The company took out full-page ads in the New York Times and Washington Post to defend events held to award high achievers. One such meeting -- a trip to Las Vegas for key mortgage employees -- had been scheduled for last week, but was canceled by Wells after some in Congress said it was inappropriate spending for a bank that has received $25 billion in government funds to bolster its finances.
In the newspaper ads, headlined "The Value of Team Member Recognition," Wells CEO John Stumpf wrote that "many media stories on this subject have been deliberately misleading. These one-sided stories lead you to believe every employee recognition event is a junket, a boondoggle, a waste, or that it’s for highly paid executives. Nonsense!”
He said the events were an important way for the bank to acknowledge workers' contributions, including their efforts to fuel new lending to help lift the housing market.
“For many, it’s the only time in their lives that they’re publicly recognized and thanked for a job well done,” Stumpf wrote. “This recognition energizes them. It inspires them."
Nonetheless, San Francisco-based Wells said last week that it decided to cancel the mortgage event "in light of the current environment." The meeting had been planned for the Wynn Las Vegas hotel and resort.
The bank said it had no other recognition events planned for 2009.
Wells got $25 billion in government capital last fall as part of the Bush administration's plan to strengthen major banks and encourage them to boost lending.
Here's my modest suggestion for all banks: If you want to hold awards dinners or other get-togethers for your valued employees, do it in your headquarters city or somewhere other than a lavish resort. And in particular, avoid lavish resorts in Sin City. No matter how you try to defend it, a meeting of bankers in Las Vegas just isn't going to sit right with the public "in the current environment," to borrow Wells' phrase.
-- Tom Petruno
Photo: Wells Fargo CEO John Stumpf. Credit: Jim R. Bounds/Bloomberg News