Many thanks to Paul Starobin for getting to the bottom of the question of journalists being paid by Wall Street to give speeches. This is one of those issues, a bit like the exact meaning of “off the record”, where everybody thinks they know what the standard is, but everybody also thinks it’s different.
It turns out there are lots of different standards. At one end of the spectrum you have The Wall Street Journal, which simply bans its journalists from accepting speaking fees at all. Interestingly, it’s also the most influential financial news outlet, according to Gorkana’s recent survey. Second on the Gorkana list is Bloomberg, which also bans its journalists from accepting speaking fees, but loopholes can be found. Bloomberg View editorial board member Clive Crook, for instance, is not a full-time Bloomberg staffer, and thus feels free to accept such fees.
Third on the Gorkana list is The New York Times, which has a slightly messier and more nuanced approach to speaking fees: basically, you’re allowed to take them, but only from non-profit organizations like universities. And even that rule can be bent: when Joe Nocera gave a speech to a securities conference in Miami, New York Times spokesperson Eileen Murphy told Erik Wemple that “there is some flexibility to our guidelines around speaking engagements”.
Fourth on the Gorkana list is Reuters, which isn’t mentioned in Starobin’s story. Our policy is that “payment should not be sought or accepted”, but travel and lodging reimbursements may be accepted.
After that, it becomes more of a free-for-all. At the FT, both Gillian Tett and Martin Wolf can and do accept speaking fees from anyone they want; Tett’s income from such things is “well into the six figures”, she says, and she has chosen to give “most” of it to a UK charity. And the FT seems to be more the rule than the exception, if Starobin is to be believed:
Many journalists give paid speeches to businesses and business groups. And Wall Street, as it happens, is probably the top source of such engagements. Household names like Bank of America as well as obscure hedge funds, private-equity firms, and others in the financial world frequently hire journalists—including scribes who regularly cover Wall Street—to deliver speeches at events ranging from publicized conferences to small private dinners with select clients. Millions of dollars have flowed to journalists in speaking fees in recent years.
We’re moving to a world where brands are more personal than they are corporate — where the likes of Michael Lewis and Malcolm Gladwell and Jim Surowiecki and Bill Cohan and Bethany McLean and Sarah Ellison and Niall Ferguson and so on and so forth are self-employed freelancers for various publications, rather than being full-time employees. As such, they have to make up their own rules about speaking fees, and it’s incredibly easy when you’re in that situation to tell yourself that you would never be unduly influenced by corporate interests and that therefore no harm could be done by taking Wall Street’s dollar.
Given that all these other stars are likely to be happy accepting paid speaking gigs, it’s easy to see how employers like the FT and CNN feel the need to allow their stars to give paid speeches too. (Fareed Zakaria has a rack rate of $75,000, and has given speeches to a long list of financial firms, including Merrill Lynch and T. Rowe Price.)
So what should be done? The vision of Gretchen Morgenson tying herself up in ethical knots before deciding what she can and can’t do is not a particularly edifying one: there’s got to be a better way than this.
On occasion she gives paid speeches to universities, as Times policy permits, and sometimes she appears, for free, at financial-industry events—but not without doing due diligence. “I did recently participate in a one-hour question-and-answer session about the state of the economy and markets with about 50 clients of First Long Island Investors, a small, local registered investment advisory firm,” she said in an e-mail. “It does business only in New York and Florida, has 200 or so accounts, and does not conduct securities underwriting or trading for its own account. As such, it would not be a firm I would cover. I received no honorarium for my participation in this session and before I agreed to participate, I checked that the firm had not been subject to any regulatory or disciplinary actions.”
My feeling is that for full-time employees of media organizations, a single, named ethics chief should make final determinations in all cases where a journalist wants to give a paid speech. It’s silly to ask the journalists themselves to make such determinations unilaterally, since they’re the ones being paid. The rules could be written or unwritten, but at least there would be someone being clear about what is allowed and what isn’t. Alternatively a blanket ban, like the WSJ has, works just as well.
For freelancers, however, things become a lot more difficult. The NYT, for one, tries to hold its freelancers to the same standards as its full-time journalists, but that’s hard, especially when the NYT isn’t paying them nearly as much. At the very least, we need more disclosure. This is very telling:
With the notable exceptions of Gillian Tett, Michael Lewis, and Martin Wolf, most of the journalists I tried to talk to about their speaking appearances resisted comment, or would only talk anonymously—which is a little ironic. One prominent scribe pleaded not to be mentioned at all. (Sorry, no passes.) I still have the bite marks on my neck from a telephone conversation with another who demanded to know whether he was the target of a “hostile inquiry.”
If you’re not proud to be giving a paid speech, and happy to be open about that fact, then it seems to me you shouldn’t be doing it. And that applies whether you’re self-employed or not.
Felix Salmon is a financial writer, editor, and podcaster. A former finance blogger for Reuters and Condé Nast Portfolio, his work can be found at publications including Slate and Wired, as well as his own Substack newsletter.