Meet the new Goldman, same as the old…

Even when you’re doing “God’s work,” it turns out, a little deft marketing is in order.

Goldman Sachs (GS), of course, put out its annual proxy filing on Friday afternoon, cordially inviting shareholders to a morning of procedural formalities and largely predetermined balloting. True to form, the dollar figures in the summary compensation table are eye-popping, and got plenty of coverage — $14.1 million in total compensation for Chief Executive Lloyd Blankfein, and just a couple hundred thousand dollars less for his lieutenants. Even Blankfein’s top-notch driver saw his pay double, as the WSJ noted.

But it’s easy to miss the forest for the trees. Taken as a whole, the proxy screams out that this is the new, sleeker, more publicity-conscious Goldman. Just look at the reader-friendly, two-column layout! (And the drabber 2010 edition.) Check out the smiling, color photographs of Lloyd & the gang on the company’s board, with their many good works in easier-to-find bullet lists (trustees of Harvard Law School, Harlem Children’s Zone, Carnegie Endowment for International Peace!) — and contrast it with last year’s dense, pictureless expanse of gray.

There’s more to the redesign than snazzy visuals. There’s also a new two-page letter to shareholders — after the usual terse invitation to the meeting, but before the table of contents — signed by “The Board of Directors of The Goldman Sachs Group, Inc.” (oh, those stiffly formal bankers!) and vowing that “[o]ur most important responsibility is to protect shareholders’ interests.” They summarize the company’s financial results and tout the company’s commitment to “effective governance practices,” “our culture of teamwork, excellence and client service,” “[e]nsuring that pay is tied to performance, especially at the most senior levels,” and “[a]ctively engaging with our broader community through environmental, social and governance practices, in addition to philanthropic efforts.” The second page is devoted to the many laudable things the board has done, under headings like “Accountability and Leadership,” renewing a vow to review the board’s leadership structure each year, and describing an “extensive review” of the business’s practices and 39 (unspecified)

“recommendations for change spanning client service, conflicts and business selection, structured products, transparency and disclosure, committee governance, training and professional development and employee evaluation and incentives.”

And we’re just a few pages into the 95-page document — which was filed along with a 47-page presentation on corporate governance, and a 17-page presentation on pay practices. There’s much more of the same throughout. It’s breathtaking, really — hopefully the folks in Goldman’s investor relations, legal and/or communications departments got extra bonuses for producing such a comprehensive body of work.

There are, in fact, a few signs of concrete change. For one thing, the company stake held by Goldman’s partners seems to have finally dipped below 10%, to 9.94%, after being just above that threshold only a few weeks ago.

Plus, the board met 17 times last year, up from a dozen meetings in 2009. (We’d assume last year’s Wells notice alone, along with the subsequent brouhaha, would add a couple meetings.) The compensation committee met 13 times last year, as opposed to just six times in 2009, though last year’s proxy says four of the 2010 meetings were about 2009 pay.

Other details in the proxy were less impressive. For example, while the company formed a new Risk Committee in September last year — “We believe that the Board and the firm benefit from having a committee that can focus specifically on risk-related issues and our firm’s risk management structure,” the board tells us in its new front-of-the-proxy letter — the panel met just twice in the final four months of the year.

As has been previously reported, the company has ramped up base pay for the top brass, giving salaries of $2 million to Blankfein and Chief Operating Officer Gary Cohn, and $1.85 million to other top executives, from $600,000 across the board in 2009. (We have to assume that $150,000 gap is pretty much symbolic, in the grand scheme of things.) In addition, Goldman has joined lesser firms in offering a long-term incentive plan, to “further ensure a clear and direct link between the firm’s performance and our executives— compensation…” Yes, that’s one more layer of compensation, and one calculated in part on an adjusted version of return on equity that includes or excludes items determined by the board’s comp committee “in its sole discretion.” It’s almost enough to make Goldman’s pay structure positively ordinary in its largesse.

Goldman also emphasizes the forfeiture and recapture provisions of its equity awards, which apply for five years and kick in if an executive gives the company “cause” for dismissal, engaged in “improper risk analysis” or didn’t “raise concerns sufficiently about risk” that leads to “a material adverse effect impact on our firm or the broader financial system…” (or could reasonably be expected to do so). Nice of them to be looking out for the rest of the world, but there’s a lot of flexibility in there. The acid test: Would these provisions have led to anyone losing pay during 2006 through 2008? We may never know until the next crisis. At the same time, the company’s penalty for partners who go to work for competitors — also forfeiture of equity awards — appears to have gotten harsher for those doing so within a year of an award (100% forfeiture, as opposed to 60%), but less harsh three years out (33% forfeiture, as opposed to 60%).

Finally, Goldman Sachs Gives, the charitable initiative that the company called much attention to last year with $500 million in donations straight from the company’s compensation pool, has slipped to $320 million. Granted, Goldman’s comp expense fell as well — by 5%, Bloomberg News reported — but Goldman’s giving feeling fell by more than three times as much.

All in all, we give Goldman high marks for marketing sizzle. As for substantive change, the jury’s still out.

Image source: click-see via Flickr