Equifax, Wells Fargo chiefs weather congressional grilling

Congress
Two CEOs fared well in recent congressional hearings.

Two chief executive officers sat in the hot seat Tuesday during congressional hearings, but they survived, which is the goal of such things, according to a Fortune article.

Newly retired Equifax CEO Richard Smith and Wells Fargo CEO Timothy Sloan each took their turns as lawmakers lobbed questions and insults at them over scandals that slammed both companies recently. House members wanted answers about a major hack at Equifax that put 145.5 million U.S. consumers at risk. Sloan sat before senators who questioned him about a sales approach that led to the creation of millions of potentially fake accounts.

Both men fared well from a communications perspective, the article states. That’s because they used three tools in their approaches. First, they released their opening statements the day before their hearings, “ensuring a wave of media coverage of their key points” and “knowing that their points would get completely lost in the next day’s coverage of the hearings, overwhelmed by the newsier zingers the lawmakers would undoubtedly deliver,” the article states. It cites one example from Rep. Greg Walden, R-Ore., who told Smith, “I don’t think we can pass a law that fixes stupid.”

Second, they followed an established formula in which they apologized and accepted responsibility, explained what happened and what measures are in place to remedy the problem, called for broader measures industrywide and apologized again, the article states.

Third, Smith and Sloan had their heads in the game. “Most CEOs are used to being fawned over. So, suddenly being treated like a piñata can be truly jarring, provoking either pique or disorientation,” the article states, calling out Sloan’s predecessor John Stumpf, who could barely answer the questions from the Senate Banking Committee last year.

Sloan held steady, the article states, when Sen. Elizabeth Warren, D-Mass., told him, “At best you were incompetent, at worst you were complicit.” He stayed humble while naming reasons why he should keep his job, which he took 11 months ago.

“His counter-argument likely persuaded nobody. But at least he didn’t provide a snotty retort or meltdown moment that would have dominated the coverage,” the article states.

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