Greg Smith spoke - will Goldman Sachs listen? - Business Ethics ...

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By Lauren | March 15, 2012

Talk about a resignation letter ? yesterday, Greg Smith, a midlevel executive at Goldman Sachs? London office, submitted his resignation in an e-mail to his bosses. The e-mail reportedly expressed Mr. Smith?s concerns about Goldman?s culture, describing his belief that the investment giant had gone too far in putting its own interests ahead of its clients. What he reportedly neglected to mention, however, was that, about fifteen minutes later, The New York Times would post an op-ed piece online in which Mr. Smith blasted Goldman Sachs for its greedy corporate culture.

Since then, the news media has gotten busy with its usual hype. The talking heads are arguing about whether Mr. Smith has a valid point or corporate greed is just another aspect of doing business on Wall Street. Some of them point to other large investment banks as bastions of similar greediness, suggesting that Mr. Smith was a touch naive to expect anything else. Mr. Smith?s method of delivering his message has been roundly criticized - after all, isn?t it in bad taste to criticize your employer in public, no matter how well-deserved the criticism might be? And then, of course, the satirists have weighed in. Apparently, Darth Vader?s resignation from the Empire, based on the Smith op-ed, is being widely enjoyed around the Internet world.

So, once again, the hoopla is obscuring the substance. Still, I hope someone at Goldman Sachs is can put defensiveness aside and focus on what Mr. Smith was trying to say. It used to be that investment banking was a fairly conservative business, where profits were built over time based on careful analysis and genuine value. Investors used to be able to trust their advisors to offer sound advice in their best interest, not simply to push whatever product would yield the most for the advisors? firms. It?s hard for me, as someone outside of Goldman Sachs, to know how valid Mr. Smith?s complaints are. But unless someone at Goldman Sachs takes the seriously enough to find out, the firm is likely to ensure similar embarrassments in the future. Pushing for a quick buck is not a great way to maintain a business that?s based on trust.

To read the Greg Smith op-ed, click here.

Topics: Business Ethics, Social Ethics, business communications, corporate responsibility, customer relations, ethics |

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