Goldman Sachs’ exclusive — and bloated — ‘management committee’ of top bankers can get even bigger: insiders

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By Dan Sears

Goldman Sachs’ exclusive “management committee” of top bankers has become bloated under CEO David Solomon, according to critics – but some insiders are betting it’s about to get even bigger.

The Wall Street giant is expected at the end of the month to make major changes to the powerful panel known internally as “MC,” which currently includes some 30 top executives, sources close to the bank told On The Money.

By some accounts, that’s more than double the size of the committee under Goldman’s ex-CEO Lloyd Blankfein, when MC included roughly a dozen bankers including division heads, the chief financial officer and the head of human resources.  

Others at the bank say – while the group is large – it’s not at an all-time high.

Now, insiders say Solomon and operating chief John Waldron look poised to enlarge MC further as the bank scrambles to convince top-performing partners to stay even as profits have thinned.

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“They’ve been telling everyone they’re going to do a shakeup of the MC for months,” a source said. “The problem is they’ve suggested to a large number of people they will be on it.” 

CEO David Solomon
Insiders say CEO David Solomon (pictured) and operating chief John Waldron look poised to enlarge the management committee further as the bank scrambles to convince top-performing partners to stay. Paola Morrongiello

Ahead of the expected announcement making changes to the group, an estimated two dozen people believe they could nab a spot on the coveted committee, sources said. 

“It’s been used as a currency to get people to stay: ‘Don’t leave, you are MC material,’” a source explained. “It’s a retention tool at this point.” 

“There is perceived prestige,” another source added. “You’re perceived to be in the inner circle.”

Still, others say the MC isn’t as important as it used to be. In years past, the group was seen as a relatively nimble team of high-level officers that created a strategy for the firm and then executed the vision.

 “When there were 12 people it was more powerful and interesting,” the source added. “The bigger it gets, the less cachet it has.”

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“There’s always a lot of speculation about Goldman Sachs’ Management Committee – with people naturally coming on and going off over its history. But once again, David has neither appointed nor told anyone that they are joining Management Committee.” Tony Fratto, global head of corporate communications said in a statement.

More recently, when the MC warned Goldman’s top brass about leaning in too much to consumer banking – a bet that turned out to be a disaster – it was ignored, according to one well-placed insider.

More broadly, the MC is so large that it can’t discuss anything too confidential for fear of it leaking. The group doesn’t even learn the bank’s earnings until all the firm’s thousands of managing directors get the numbers at a town hall, sources said.

“You can’t have 30 some-odd people in a room making any real decisions about the future of the firm,” one source close to the situation said. “The more people in the room, the less you can discuss.”

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Now, sources say it’s the worst of both worlds – the group will still be large and unwieldy and yet many employees will be disappointed they didn’t make the cut. 

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