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Posts Tagged ‘Goldman Sachs

Wall Street Hearts Gay Marriage

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Okay, that might be an exaggeration, but last night, while the eyes of the Wall Street media were still focused on Goldman Sachs’ sex-discrimination suit, the American Foundation for Equal Rights–the group that spearheaded the battle to fight California’s gay marriage ban–held a fundraising benefit in Midtown Manhattan, and executives from KKR, Blackstone, Carlyle Group, Goldman Sachs and others from the investment banking, hedge fund and private equity industries were in attendance to support the organization.

Such a public display of affection for the rights of gay and lesbians is a complete about-face by the upper echelons of the finance industry compared to how they dealt with this issue just a few years ago.

In Vault’s annual Banking Survey, administered each spring for more than a decade, we have asked professionals in the industry to comment on their firm’s diversity efforts with respect to gay, lesbian, bisexual and transgender employees, as well as with respect to women and minorities. It wasn’t too long ago that a majority of those surveyed would respond to the GLBT question with, at best, “no comment,” while freely providing scores of information about diversity efforts with respect to women and ethnic minorities. In addition, even when we did receive a comment, and a positive comment at that, about a firm’s GLBT diversity, the commenter, more times than not, did not wish to go on record; to boot, PR heads of firms continually lobbied for the removal (from the survey write-up) of any mention of GLBT diversity–even if their firm was painted in a very positive light.

In the past couple of years, however, this has been changing. We now receive just as many (or almost as many) comments about GLBT hiring practices as we do about women and ethnic minority practices. And PR representatives are now more than happy to highlight their efforts to hire and accommodate GLBT individuals.

This doesn’t mean, of course, that the finance industry (or America’s other corporations in other industries) have come close to embracing gay and lesbian rights in the workplace, but we have come a long way, paving the way for top-ranking executives, such as Ken Mehlman, a partner at KKR, perhaps the most well known private equity firm on the planet, to come out and speak their minds.

Last week, Mehlman (who, prior to joining KKR, ran George Bush’s reelection campaign in 2004), publicly acknowledged his homosexuality. In an interview, he told The Atlantic, “Everybody has their own path to travel, their own journey, and for me, over the past few months, I’ve told my family, friends, former colleagues, and current colleagues, and they’ve been wonderful and supportive. The process has been something that’s made me a happier and better person. It’s something I wish I had done years ago.”

Kudos, Mr. Mehlman, and here’s (glass raised) to hoping that your courage will inspire other current and future professionals, as well as encourage current and future corporations to take an increased pride in the individualities of their employees.

–Posted by Derek Loosvelt, In the Black

Written by Phil Stott

September 23, 2010 at 11:36 am

No News is Good News? This Week in Employment

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It’s probably not been the worst week on the employment front when you cast your mind back over the previous seven days and two of the most significant “work”-related stories you can come up with involve scandals rather than layoffs or predictions of further doom for the economy. Not that either the stories of the alleged harassment of NFL reporter Ines Sainz or the allegations of institutionalized sexism at Goldman Sachs are issues to be taken lightly. But the very fact that they brought the usually under-reported issues of diversity and equality into the spotlight this week suggests that concern over the wider narrative of the past few weeks—the likelihood of a double-dip recession—has once again receded. That impression is borne out even further over the total lack of interest in this week’s initial claims for unemployment number—something that had been subject to serious scrutiny in recent weeks. The reason for this week’s neglect? It hardly changed at all, dropping by 3,000 claims to 450,000—and where’s the fun in writing about a number if you can’t sensationalize the “unexpected” nature of it from week to week?

In further contrast to all of the “he said, she said” titillation, the most significant story of the week—at least as far as job creation goes—almost slipped under the radar altogether. I’m talking, of course, about the small business lending bill, which passed in the Senate on Thursday. Again, it likely suffered because it’s not the stuff great headlines are made of: basically it involved both political parties finally figuring out a compromise that involves creating an institution that will lend money to banks on the condition that they then lend it to small businesses. Not glamorous, nor a quick fix, but potentially a huge benefit to job creation efforts—provided it makes it through the House next week.

Also in government-run hiring initiatives, this week saw one of the most significant layoff notices in…well…maybe ever. The Cuban government announced that it would be laying off 500,000 workers—as in half a million people in a country with a population of just under 11.5 million. While the government plans to transition many to private sector work—relaxing rules in order to increase the private sector in the process—it seems like the country is in for an extended period of upheaval ahead.

Back on U.S. soil, the most significant layoff announcement of the week looks kind of paltry by contrast: that dubious honor goes to FedEx, which is laying of 1,700 workers as it seeks to consolidate its operations. It will also be closing some 100 facilities throughout the country. Even that, however, doesn’t appear to be a sign of a negative outlook on the economy—at least not according to BNet’s Carol Tice, who wrote the following on the development:

“the layoffs are happening because FedEx has finally figured out what to do with a 2006 acquisition, Watkins Motor Lines […] FedEx had taken some time to size up that business, and figure out how to use it with fewer people. That’s what companies are supposed to do after they make acquisitions. While people are moaning about the layoffs happening now, the real question to ask is why they didn’t happen a year or two back.”

So now you know.

There was even some hiring news this week—albeit the kind of hiring news that has the potential to flat-out depress just about everyone, especially with robo-call mania not even having peaked yet in the run-up to the November mid-terms. What kind of news could that be, you ask? It would appear that the first presidential campaign hire for 2012 has been made. Or the first hire in Iowa, at any rate. Either way: it looks like it’s going to be a long road to the next election. Oh well: at least hiring in the political echo chamber should remain robust.

–Phil Stott, Vault.com

Written by Phil Stott

September 17, 2010 at 3:00 pm

Did Goldman Break Its Diversity Policy?

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For the 11th straight year, industry insiders named Goldman Sachs the most prestigious bank in North America in Vault’s latest ranking. In hindsight then, all the public mudslinging of recent years has done little to upset the bank whether it’s in attracting the biggest deals or the best talent. And according to our survey, bankers continue to want Goldman on their resume.

Ironically, a day after the rankings debuted, the bank’s prestige is under attack by three former female employees who charge, according to The Wall Street Journal, that “The investment bank practices a system in which women are paid less, promoted less and ‘systematically circumvented and excluded.'”

Jobs, Careers and Reviews at Goldman SachsWhat’s astounding about the allegation is the repeated emphasis on intent, i.e., that the bank has a system that almost formulaically excludes women from getting promoted and compensated on par with their male counterparts. While the bank has called the suit without merit, stating that, “People are critical to our business, and we make extraordinary efforts to recruit, develop and retain outstanding women professionals,” it seems it is yet again in the red with the public.

Comments from our Banking 50 survey—culled from responses submitted by over 1,300 banking professionals earlier this year—provide further perspective:

“Supportive and respectful management”

“They could do a better job of promotion as well as placement into areas that are a good fit and utilize skill sets…”

“Having come up through the ranks, from a junior trader to now an experienced one in fixed income products, I must say that I’ve been very pleased with the level of training, support and guidance that I’ve received over the years from the firm…”

“I’m a firm believer in the culture at Goldman Sachs. The firm is team-focused, emphasizing integrity and personal development within the industry.”

“I think we do a good job at getting women and diversity candidates in the door, but for real success we need to work on better retention.”

And, finally a snippet of their Diversity Mission Statement from Vault’s Annual Diversity Survey:

“The firm’s commitment to diversity is evident at the most senior levels and is driven down through the firm by way of our seventh business principle: “We offer our people the opportunity to move ahead more rapidly than is possible at most other places. Advancement depends on merit and we have yet to find the limits to the responsibility our best people are able to assume. For us to be successful, our men and women must reflect the diversity of the communities and cultures in which we operate. That means we must attract, retain and motivate people from many backgrounds and perspectives. Being diverse is not optional; it is what we must be.”

So where does this leave the banking king: A chauvinistic boys club, truly diverse with a few unintentional victims, or the victim of a ploy to take advantage of its current poor reputation? Weigh in by leaving a comment, emailing In Good Company or connecting on Twitter @VaultCSR.

More reading: The complete WSJ report.

What other banks made the Top 10 most prestigious banks in North America this year?

The Goldman Effect? Poll Says I-Bankers Not Trustworthy

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It’s official: perception of investment banking as a trustworthy profession is rock bottom. Perhaps not surprising given the news cycles recently, but pretty damning nonetheless. As results from our recent home page poll show, investment bankers and corporate lawyers are not seen as paragons of virtue at the moment, scoring significantly below journalists, and not much better than used car salespeople. Management consultants, on the other hand, seem to be riding a wave of positive perception.

Let us know your opinion of the results: do they seem valid, or like a lot of consultants had a lot of time on their hands last week, while the I-bankers and lawyers were all watching Goldman getting grilled by the government? Drop us a comment below, or hit us with an @reply on Twitter.

U.S. Senate vs. Lloyd Blankfein: Yesterday’s Main Event on Capitol Hill

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Let’s set aside the first several of hours of yesterday’s hearing in Washington (which you can read a little about here in a previous post) and head right to yesterday’s main event in which Michigan Democrat Carl Levin and his fellow Senators grilled Goldman Sachs CEO Lloyd Blankein for nearly three hours.

As the bell rang and Lloyd came darting out of his corner with his prepared statement, one thing became immediately clear: the dude needs some voice lessons. Lloyd, a former trader, possesses a piercing, high-pitched voice, and his tone comes off as whiny at best (in Lloyd’s defense, the Journal pointed out that former Goldman CEO Hank Paulson is an even poorer public speaker). After Lloyd’s powerless punch, Senator Levin began jabbing away with those “sh!tty deals” and “crap” as he’d done in earlier bouts on the day’s card, wondering how Goldman’s salesmen could pitch such “junk.” Lloyd came back swinging with an uppercut (we sell nice securities and not so nice securities and that’s our job, you ignorant moron) but Levin wasn’t hurt. Still, Levin didn’t like the tone of Lloyd’s punch, nor did he much enjoy Lloyd’s repeated blows to his kidneys (whiny lectures on what market makers do). Levin replied with a solid hook (I wouldn’t touch anything you’re selling with Senator’s Tester’s 10-foot pole) and then the bell rang, both fighters went to their respective corners, and out of nowhere came Senator McCain.

A little slow on the draw, McCain started shuffling his feet to warm up and then threw an encouraging jab (why’d you need TARP?) and another (what about the little community banks?). Lloyd blocked both but appeared to be a bit stunned, though perhaps he was simply confused, and soon McCain disappeared into the corner he came out of but not before throwing a solid left after the bell (getting Lloyd to admit that he and his GS crew are rolling in dough while McCain’s buds are homeless and broke).

Senator Kaufman spelled McCain in the next round, stepping back into the ring where he and Lloyd circled each other for some time, both throwing punches that didn’t land (Kaufman: you knew the market was tanking, you shorted the farm; Lloyd: we ain’t that smart, dude). The dancing went on for some time until Kaufman decided he couldn’t catch the wily Lloyd and threw a phantom right into the air on his way out of the ring (you bastards made a bundle and that pisses me off!).

Dr. Coburn was back at it for the Senators in the next round and immediately brought out a fierce left hook (Congress is to blame for the crisis because we didn’t regulate you stinking outlaws!) and he didn’t let up, bringing it to Lloyd in what was nearly called a TKO, hitting the CEO with a series of lefts (why did you release Fab Fab’s personal emails and no one else’s?) and rights (you’re hanging Frenchie out to dry, we all know it). Lloyd put his arms over his face (stammering and stuttering over his words) and luckily was saved by the bell.

Charging out of her corner came Senator McCaskill and she tried to keep the heat on Lloyd with a nice combination (synthetic CDOs sound like dog poop to me) but Lloyd wasn’t fazed. So out came Senator Tester and he threw one of his wild hooks that he’d been tossing around all day (it’s all just a scam this gambling trading thing y’all do!).

Lloyd was obviously fatigued as he stumbled out for the final round. Levin looked like the 10-plus hours of fighting had gotten to him as well—but that didn’t keep the Senator from bringing the blows. Levin went low, working Lloyd’s midsection (explain to me this whole AIG bull: just how did you get 100 cents on the dollar?). Lloyd was ready for these punches and ducked and dodged (hate the game not the playa). Levin was confused but miraculously still on his feet and feeling stronger than ever. With the bout in its final few seconds, Levin went in for a final few blows (what about this email? and this one? and again: how can you live with yourself, you sold “sh!tty” deals and then bet against them!). Lloyd, hurting but not bleeding, tired but still standing, put up his hands (true true, but it’s not against the law, Carl) and waited for the bell to save him.

–Posted by Derek Loosvelt, In The Black

Written by Phil Stott

April 28, 2010 at 12:30 pm

Goldman Sachs: Why Reputation Matters

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Goldman protest

AP Photo/Charles Dharapak

[I]t strikes me that a lot of people dislike Goldman Sachs, and they really don’t understand what Goldman Sachs does, but they just know that they dislike them […] And then there are people who know what Goldman Sachs actually does, and they dislike them for different reasons.

–David Gregory on Meet the Press, Sunday, March 25, 2010. (Click the link for the full transcript of the show.)

Step back for a moment and imagine that your company is in Goldman’s position right now: Universally reviled; Accused of betting against not only its own customers but the entire economic wellbeing of the country; At the center of an international political storm (one example: the bank has become a talking point in the UK general election); So unpopular that you can’t find political support even among the most pro-business members of the opposition.

So, given that that’s your company, what do you do? Do you go out on a limb and further expose yourself in the public eye, or do you find a way to control the damage to your firm’s image and regroup, hoping it will all blow over?

By now, it should be obvious which path Goldman has chosen. The megabank seems to be playing a game of chicken with the government—actions that, as Frank Rich pointed out this weekend—may actually be handing the government the leverage it needs to pass reform that will handicap not only Goldman, but all of its neighbors on Wall Street. Which should all but destroy any last shreds of popularity it has left even amongst its peer group.

All of that raises serious questions over the culture at the firm—something that, as has been noted many times before, comes from the top down. While there’s no doubt that the firm is a success, the image and reputation it has cultivated along the way makes it one of the least celebrated winners in history. And that’s a problem—both when it comes to retaining customers and in attracting and retaining talent over the long term.

Last Friday, Vault Finance Editor Derek Loosvelt published some of the preliminary findings from Vault’s upcoming annual banking survey. Given the current state of affairs at Goldman, the following nuggets from people within the finance industry seemed particularly apposite:

  • Percentage of respondents who say firm culture was the single most important factor in deciding to accept their firm’s offer over others: 35
  • Percentage who say prestige was the most important factor: 18
  • Percentage who say compensation was the most important: 9

Bear in mind those figures are from people already working in Goldman’s industry. If they’re to be believed, the issue of compensation—including those bonuses that we keep hearing about—isn’t enough to attract and retain top candidates. But culture and prestige are: and Goldman is in the process of squandering its reputation for both in record time.

Backing those figures up, meanwhile, is a recent Vault homepage poll, which found that some 25 percent of respondents would be less likely to consider working for Goldman in light of the SEC investigation. And that’ in addition to the 10 percent who told us that they wouldn’t have considered taking a job offer from the company in the first place. Of course, that still leaves a majority of respondents who are willing to overlook the allegations of wrongdoing—at least in this instance—to take a job at the firm. Should the negative publicity the firm is attracting continue, however, that number would likely drop.

While it would be a stretch to say that the current climate is going to be enough to bring Goldman down, it should serve nonetheless as a cautionary tale for anyone seeking to lead a business—or even looking for a job right now. If your company—or one you’re thinking about working for—has the kind of reputation that Goldman is in the process of forging for itself, attracting and retaining top employees becomes that much harder. And without them, the entire house of cards starts to tumble.

Poll Results: SEC Case Reduces Willingness to Work for Goldman Sachs

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A little perspective on what the Goldman Sachs SEC case might be doing to the company’s reputation: We recently ran this poll on our home page (and it’s still there, if you’d like to take it), and it clearly suggest that being unpopular is not the way to attract or retain staff. While the majority of responses suggested that people would overlook the company’s alleged wrongdoings at least once, fully a quarter of respondents claimed that the case would affect their willingness to work at Goldman. Prestige and reputation, it would seem, really do matter (as former employees of Madoff Securities would no doubt tell you: no-one wants a high-profile miscreant–or alleged miscreant, in Goldman’s case–on their resume).

Goldman prestige poll


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