By: Marty Raminoff
Goldman Sachs Chief Executive Officer, David Solomon, has long been a contentious leader. Things seem, however, to be getting worse for him.
It’s not just the junior staffers bashing the CEO now. As reported by the NY Post, Goldman’s middle and upper management ranks are beginning to rile up against Solomon. The 60-year-old CEO has held the position since October 2018. Before that he served as the firm’s president and chief operating officer from 2017 to 2018. He had first joined the white-shoe investment bank as a partner in 1999. His deal-making abilities helped him to jump over layers of management reaching the top ranks of the banking giant. In many ways, however, he has always been different from the posh culture at Goldman. His history was working in junk bonds at Bear Sterns. He also has a hip side gig as an electronic music DJ. He’s not proficient in small talk, and he doesn’t consult with others before executing edicts. In many ways he’s an outsider in his own company, and many in the ranks are starting to speak out about it. “He doesn’t breed a lot of love,” said one former Goldman executive who seems to know Solomon well.
To be fair, Solomon is a hard worker, with a no-BS personality. He expects a lot of junior staffers, and they don’t like him for it. Under his management, Goldman flourished. Even now during the downturn, company shares are up about 60% since 2018, when Solomon took over the reigns as CEO. For comparison, the S&P is up about 44% over that time period, per the Post. Under his leadership, Goldman has widened its share in the crucial mergers and acquisitions market, gaining over rivals. Also, Solomon was one of the first among his banking CEOs to foresee the market slump and took quick, decisive measures to cut costs.
Despite this, as per the Post, managing directors and partners at the firm are grumbling about Solomon. The complaining is not pointless, but rather historically has heavy weight before the company board, which ultimately steers that fate of company leadership. In the past, Goldman’s powerful trading department has been successful in stimulating the board to make a management change.
Not all is rosy at Goldman ,and this could potentially be used as an excuse to sack Solomon. Its rival investment bank, Morgan Stanley has continued its steady ascent to beat Goldman in market value, $144 billion to $116 billion. Even though this represents a trend which began before Solomon, it can still be used against him. Also, Solomon has been focusing his diversification efforts on creating a digital retail bank named Marcus.
The endeavor, first started by the previous CEO, Lloyd Blankfein, but expanded by Solomon, has so far proved to be a disaster, the Post reported. In the meantime, Morgan Stanley’s CEO, James Gorman, poured his attention into that bank’s firm’s wealth management operations, and was successful in nurturing a steady revenue source. Goldman has also missed several financial targets in its recent earnings reports. In addition, Goldman employees are seeing a decline in bonuses, which will mean they are dissatisfied. That unhappy grumbling is what started the trouble for Solomon in the first place.
