Published 8 April
Is the wind changing at Goldman Sachs? It is clear that while the firm might have won the revenue battle, it has resoundingly lost the public relations battle. "Goldman is revealed as part of the problem, not the solution," a well-placed source said. A recent profile of Lucas van Praag, the Goldman partner who runs corporate communications, points out that Goldman’s public relations have badly misfired: "It isn’t just that the cooed-over firm has become the iconic scoundrel of an entire era. It’s also how much worse they’ve made things for themselves with a continuing communications and PR policy that’s basically a stiffly extended middle finger, waved in the air for all to see."
It could be argued that the Goldman allure is waning and that all those years of invincible isolation have unleashed a backlash of Goldie bashing. However, I discern a more ominous development. Did you notice that in March two very senior revenue producers resigned from the firm? Fred Hu, the bank’s chairman of greater China, left to set up a private equity fund and Pierre-Henri Flamand, head of the principal strategies group, left to found a hedge fund. Hu was known for his contacts and Flamand for his trading ability so these departures are a loss to the firm. A rival banker told me: "It used to be the case that you couldn’t get people out of Goldman unless Goldman wanted them to go. That’s not true today." In the short term, Goldman will not be able to pay its stars what the stars probably consider they are worth. In London, this year Goldman partners took home only £1 million. In fact, I noted wryly that Goldman’s chief executive, Lloyd Blankfein, was awarded a $9 million bonus whereas Stuart Gulliver, the chief executive of HSBC’s investment bank, made £9 million. Are we in a new era where working for Goldman Sachs is no longer a licence to print money? Indeed is this an era where Goldman is no longer as glossy and smug as it once was? After all, if the best people don’t want to work for Goldman, where’s the famous Goldman edge?
Finally, I offer you an April riddle. Which highly respected US bank chief executive, upon meeting a lovely young female banker, immediately lowered his eyes to her chest? This gesture is apparently dubbed "the drop-shot" by militant feminists.
Abigail Hofman: Goldman amid adversity
May Euromoney
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