Why I Am Leaving Goldman Sachs Op-Ed

Yesterday, Goldman Sachs executive director Greg Smith resigned from his position and wrote an op-ed in the New York Times to let the world know the reasons for his decision.  Despite the immediate satirical response by comedians, Smith's opinion piece shed light on Goldman Sachs descent from the perspective of an executive.  Here is a selection of quotes that might catch your attention.  

"TODAY is my last day at Goldman Sachs. After almost 12 years at the firm — first as a summer intern while at Stanford, then in New York for 10 years, and now in London — I believe I have worked here long enough to understand the trajectory of its culture, its people and its identity. And I can honestly say that the environment now is as toxic and destructive as I have ever seen it.  To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money. Goldman Sachs is one of the world’s largest and most important investment banks and it is too integral to global finance to continue to act this way. The firm has veered so far from the place I joined right out of college that I can no longer in good conscience say that I identify with what it stands for.

How did we get here? The firm changed the way it thought about leadership. Leadership used to be about ideas, setting an example and doing the right thing. Today, if you make enough money for the firm (and are not currently an ax murderer) you will be promoted into a position of influence.

It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail.

I hope this can be a wake-up call to the board of directors. Make the client the focal point of your business again. Without clients you will not make money. In fact, you will not exist. Weed out the morally bankrupt people, no matter how much money they make for the firm. And get the culture right again, so people want to work here for the right reasons. People who care only about making money will not sustain this firm — or the trust of its clients — for very much longer." 


Even though only a select few individuals have access to the inner workings of investment banks, many Americans assume greed and manipulation are pervasive on Wall Street.  Why, then, did Smith's public resignation garner great levels of attention?  Smith has nothing to gain from rebuking Goldman Sachs.  He's already a mid-level executive who left his position of Goldman's US derivatives trading for Europe, the Middle East, and Africa.  His intention appears to be a sincere desire to confirm the widely held perception that the financial industry prioritizes profits ahead of customer satisfaction.  


Not surprisingly, a number of parody articles have been written overnight.  The most popular satire thus far is a piece from The Daily Mash titled "Why I Am Leaving the Empire".  In the article, a disgruntled Darth Vader expresses disgust with his employer:


“The Empire is one of the galaxy’s largest and most important oppressive regimes and it is too integral to galactic murder to continue to act this way. The firm has veered so far from the place I joined right out of Yoda College that I can no longer in good conscience point menacingly and say that I identify with what it stands for.”    


Minyanville writer Michael Comeau has also penned a letter to Goldman CEO Lloyd Blankfein called, "Why I Am Applying for an Executive Director Position at Goldman Sachs".


"Ultimately, however, I believe I have the right attitude for the job.

First of all, I am an awesome dude.

My proudest moments in life -- getting accepted to Brooklyn College, passing Intro to Chemistry, and competing in countless Wiffle-ball and roller-hockey games, known as the Brooklyn Olympics -- were achieved through pure awesomeness, with no shortcuts.

And more importantly, Lloyd, I know how to keep my mouth shut."