Goldman Sachs is facing a talent exodus – and it’s all originating from its top female ranks.
When David Solomon was crowned CEO of the bank in 2018, the future of Goldman’s diversity, equity and inclusion initiatives glimmered with optimism. Talented women – regardless of their seniority – were assured that they would be prioritised when it came to promotion season. Goldman’s longstanding macho culture seemed to be coming to an end.
But it’s a shame that hasn’t quite worked out.
Many of the bank’s top women are now heading for the doors. Stephanie Cohen, the bank’s former Chief Strategy Officer and, more recently, Global Head of Platform Solutions, and Beth Hammack, ex-Co-Head of the Global Financing Group, are just the major figures among these names.
This is pretty damning on the firm, but – unfortunately – it's not a surprise. As found by The Wall Street Journal, no woman currently runs a major division in the firm – and only a shocking 19% of partners are women. Despite Solomon’s promise, which was clearly quota-orientated, opportunity for women in Goldman Sachs just doesn’t seem to be there.
Sadly, all organisations, not just the banking monoliths of this world, were built for men, by men. So, when a woman walks into a company like Goldman, it doesn’t matter if they received a double first in Economics from Cambridge University. The odds, the culture, and the environment are all stacked against her.
Ironically, quotas are just another hurdle for women to leap over. They are just another metric that pit women against each other and spur unhealthy, damaging rivalries.
So, if Solomon is really serious about welcoming women into Goldman – and of course, meeting necessary DEI (Diversity, equity, inclusion) requirements – it’s critical that he stops imposing quota-backed blockers. Ultimately, Goldman needs a wholesale cultural transformation: quotas will only hinder this process.
But the same goes for the whole industry. As found by the UK Treasury Select Committee’s ‘Sexism in the City’ report, the cultures across financial services are downright critical. In fact, they’re so unhealthy that the Financial Conduct Authority is now investigating how investment banks, commercial insurers, and the like deal with sexual harassment, bullying, and other non-financial misconduct.
Goldman Sachs and other investment banks offer tremendous value: they’re some of the most recognised names across global business and, if you ask any recent university graduate, the ‘golden snitch’ of all job opportunities. But their cultures are outdated. They need serious work.
You cannot expect women to thrive in these environments. Women in the old boys’ clubs of financial services stick out like a sore thumb. They never feel a sense of belonging.
I recognise that organisational transformation and cultural turnarounds are not easy tasks. They take a lot of work and, unsurprisingly, a lot of effort from the executive teams. Leaders, including David Solomon, will have to completely re-evaluate their view of company culture.
But culture is a major pillar of company success. It’s not about drinks on a Friday, monthly team crazy golf, or company merchandise; it’s about galvanising your talent, increasing team cohesion, talent retention, cross-department collaboration, and productivity.
To be a modern workplace, equal representation – across all levels of the firm – is completely and utterly necessary. If you fall behind on these expectations, like Goldman Sachs might through this exodus, you leave yourself open to reputational damage. You cannot see your talent as a list of meaningless figures, KPIs and other metrics; you have to see them as humans.
As I outline in my new book A Leadership Shift, the benefits of removing quotas and transforming your culture are endless: team communication, work ethic, and efficiency all drastically improve. If Goldman Sachs, led by Solomon, undertakes this responsibility and takes the leap they could remove the highly-publicised, undesirable aspects of their culture – and be at the forefront of organisational innovation.
They could light the touchpaper. Other financial institutions would follow in their footsteps.
Dr. Nahla Khaddage Bou-Diab is a culture and leadership expert, chairman and general manager of Oneness Mgmt, and CEO of AM Bank.
