U-turns seem to be in vogue at the moment – along with the tendency of those doing the U-turning to pitch any reversals as logical evolutions of what came before. So it is at Goldman Sachs, whose chief executive David Solomon this week cast his latest reorganization of the firm as “the next phase of our growth”.
It might still turn out to be just that. For all the commentary that the latest moves mark a backward step in Solomon’s ambitions for Goldman to broaden its appeal beyond investment banking, there is in fact very little being unwound here. There is also no doubting both the continued strong performance from the firm’s core franchises and the difficulty of hitting precisely on the ideal version of a new approach at the first attempt.
In a bid to make his latest changes look proactive rather than reactive, Solomon has been at pains to portray them as a continuation of the strategy that the firm set out in its now-famous investor day in January 2020, and which we have already discussed here, here, here, here and even here.
Gold standard
Boiled down to its essentials, it meant doing a little more of the stuff that is less volatile than the core advisory, underwriting and trading businesses that Goldman has always been about.
