Goldman aims to preserve pre-IPO culture, even as partnership dwindles
By Henry Engler
WASHINGTON, May 15 (Reuters) - Goldman Sachs Group Inc
has launched a global training initiative to safeguard
the tight-knit culture it developed as a private partnership,
even as the bank marks its 19th year as a publicly traded
Bank leaders, including Chief Executive Officer Lloyd
Blankfein and his deputy, Chief Operating Officer David Solomon,
have been anchoring 2-1/2-hour sessions with managers across the
globe since September, focused on improving culture and employee
conduct, executives involved with the effort told Thomson
Reuters Regulatory Intelligence.
Since the 2007-2009 financial crisis, regulators have put a
strong emphasis on improving corporate culture and employee
behavior in a bid to reduce risk across the system.
Some 2,500 employees are expected to participate in the
mandatory exercise known internally as the “Chairman's Forum”
by the time it concludes later this year, the executives said.
The sessions recreate everyday workplace scenarios to
encourage senior staff to think about how they should behave
when faced with tough decisions and conflict, including with
respect to client transactions.
Stephen Scherr, CEO of Goldman Sachs Bank USA, which houses
the bank's consumer and corporate lending businesses, has led
two of the gatherings so far. Instilling uniform cultural values
has gotten more difficult as Goldman has grown from the private
firm with 5,000 employees Scherr joined in 1993 to the global
banking institution with 30,000 employees that it is today, he
“When I look back over 25 years, I don't think the themes
that are being covered in these more organized sessions are
frankly very different than those that were pervasive early on,”
said Scherr. “What has changed is that at a purely practical
level we're a much bigger organization.”
Goldman Sachs listed on the New York Stock Exchange in May
1999. The bank has maintained its partnership program, but
partners now represent less than 2 percent of total staff.
Goldman took a hard look at its culture following the
financial crisis, when its image was tainted by claims it misled
investors over profitable mortgage trades and a former employee
who wrote a book accusing bank executives of calling clients
Following that review, an internal committee released a
report in 2013 reiterating a set of core business principles
established by former CEO John Whitehead that focused on
integrity, trust and putting clients first. (http://reut.rs/122nCbB)
The training sessions build on that effort, especially as
Blankfein enters his 13th year as CEO and prepares to eventually
hand the reins over to Solomon.
Goldman executives said they are trying to make the training
sessions relevant to real situations managers encounter.
Sessions begin with video case studies that lead to interactive
Blankfein makes an appearance at the start of each session
by video, telling managers to foster a culture in which
employees see it their "individual responsibility to raise
issues that they are worried about."
(Reporting by Henry Engler of Thomson Reuters Regulatory
Intelligence. An earlier version of this article first appeared
in Regulatory Intelligence.
Editing by Michelle Price and Meredith Mazzilli)
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