David Solomon lacks answers for Goldman Sachs’s angry investors
As the CEO of Goldman Sachs for almost two years, David Solomon has often been seen as a beacon of optimism for the firm and its investors. However, as the markets tumble and the bank’s stock drops, voices of dissent and concern have started to rise among its stakeholders. David Solomon is now being put to the test as he faces irate investors with few solutions to their problems.
1. Goldman Sachs’s Frustration: Investors Have Questions
Goldman Sachs is one of the most storied and respected financial firms in the world, but lately investors have had plenty of questions. As earnings season draws to a close, shareholders are taking a close look at the company’s performance, and some have noticed a few concerning patterns.
Concerns about Goldman Sachs’s outlook for the future have started to mount, raising questions about the stability of the firm’s finances in the months ahead. For example, there has been a notable drop in bond and stock trading, as well as a decrease in investment revenues, leading some investors to worry about Goldman Sachs’s ability to remain competitive in the current economic climate.
- Concerns about long-term stability
- Notable Drop: bond and stock trading & investment revenues
- Worried about competitiveness
2. David Solomon’s Unfulfilled Promises
When David Solomon was chosen to lead Goldman Sachs on the 1st of October 2018, he also announced a set of changes that were thought to modernize and expand the company’s influence. His most conspicuous ambition was to raise the number of women and minorities occupying various roles within the organization.
Unfortunately, Solomon has yet to deliver on the lofty goals he put forth approximately two years ago. The firm’s workforce remains awfully imbalanced, with very little movement in terms of gender and race. Furthermore, the bank’s stance on environment, social and corporate governance allows for much criticism, with little effort to appease them. While the introduction of a new CFO and the rebranding of the Marcus online bank were lauded, they do not distract from the unmet expectations Solomon brought upon himself.
3. Seeking Answers amidst Uncertainty
We live in a world weighed down by uncertainties, where the solutions seem far and do not always meet our expectations. In times like these, it is easy to feel overwhelmed and desperate for some kind of clarity.
The journey forward does not have to be arduous. Peace of mind can be found in unexpected ways and it is important to remember that there is still joy in the unknown and the unfamiliar. Take heart in the endless possibilities and remember that:
- Positivity will provide light in the darkness, and be your guiding star
- Endurance is what will sustain you during the tumultuous times
- Adaptability is the key to embracing change
- Courage is the strength needed to move forward, no matter the situation
No matter the degree of difficulty, it is crucial to remember to never give up hope in your search for answers. Taking small steps, focusing on what you can control and most importantly, believing in yourself, that is how you combat uncertainty.
4. Time for Change at Goldman Sachs?
Since the financial crisis of 2008, Goldman Sachs has entrenched itself as a poster child of Wall Street. The bank has built a sterling reputation for itself through its business practices, as well as its ability to weather the storm when markets crash. But as with all companies, even the most stubbornly established, it is time for Goldman Sachs to make some changes.
Fortunately, the company’s shareholders seem to agree. During the bank’s annual meeting in May 2018, they voted to introduce more diversity into the board of directors and the senior management team. The board voted to create a diversity monitoring committee, which would oversee a number of initiatives to increase the female and minority representation. These initiatives will not be put into effect until the 2019 annual meeting, when they will be reviewed by the committee.
- The board has voted to create a diversity monitoring committee to oversee initiatives to increase female and minority representation
- These initiatives will be reviewed at the 2019 annual meeting
David Solomon might have been a hit as Goldman Sachs’s CEO since taking over the reigns from Lloyd Blankfein, but the lack of achievable answers for angry investors could spell trouble for his carefully crafted “boring” bank. It is too early in the game to make predictions, however, and time will tell if the CEO can have the last laugh with a return to investor faith.