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The Goldman Diversity Drive

“Starting on July 1st in the U.S. and Europe, we’re not going to take a company public unless there’s at least one diverse board candidate, with a focus on women…”

– David Solomon, CEO Goldman Sachs

Goldman Sachs has rolled out the decision to not help firms with an initial public offering (IPO) if their board does not have at least one diverse member. I take this with a big pinch of salt.

At first, this move seems like it is promoting diversity and mostly a PR move. In fact, Goldman has such a hold on media, it was hard to find many articles to research this. Well, thanks to the internet, it’s not entirely impossible.

However, take a closer look at this policy that goes into effect on July 1st, 2020. In repeated interviews, Goldman states that it would lose business but in the long term ‘it would be good for the people’. Since when did a private United States bank become so concerned about people? Well… Simply put, never. So what was the motive behind this move? To be honest, I don’t know, but, here is a graph that could indicate what happened.

Stock prices of Goldman Sachs over 5 years
Stock prices of Goldman Sachs over 5 years

So what happened?

See that heavy downfall from 2018 to 2019? That’s when the news that 2 bankers from Goldman Sachs had embezzled money from Malaysia’s Sovereign Wealth Fund surfaced. This wealth fund had over $6.5B and a huge amount of it was stolen. The best thing to come out of this abhorrent crime was the movie ‘Wolf of Wall Street’. Quite ironic, if I do say so myself. This 1MDB scam had rattled the Malaysian government and had them demanding reparations from the private bank without any form of leverage on them.

Congratulations Malaysia, you went against the bad guys and lost. Coming back to the diversity rule. Goldman Sachs has been painted as the bad guy in multiple articles but I think one of the most impactful ones is when Hasan Minhaj did a piece on this in his Netflix show Patriot Act.

What’s even more interesting is that Goldman, has not only been accused of gender discrimination itself, it has also lost that lawsuit. So, a company which has proven to be gender discriminatory, embezzled money from nations, created a culture of breaking compliance because of status and has been the villain of the real world has now decided to help firms that have women or diversity in their board of directors. Forgive me, if I don’t buy into their, ‘it is good for the people’ rhetoric because as a private company, they do not have any good in mind.

What does this mean for firms trying for IPO with Goldman?

Well, it’s quite simple. This policy is from a company whose expertise may be something to behold but has no real benefits guaranteed. If you are taking a risk by working with a private bank, make sure you have the upper hand and that you get an actually benefit from their banking practices.

If you are okay with not taking on the expertise from Goldman, I am sure there are other private investment banks more than happy to take your money, to invest of course. As far as being a company that has values and complies with regulations, you can always create your own internal policy to get a more diverse board of directors and that said, you don’t need the policy if you truly offer equal opportunity in the workplace.

Remember, the fight is not about giving someone a higher stage, it’s about equality and how humans can mutually benefit from each other, not just for themselves.

If you like this blog, feel free to check out my other blog: The Horrors of Internalised Racism

Featured Image by Paul Fiedler on Unsplash

1 thought on “The Goldman Diversity Drive”

  1. Pingback: The Horrors of Internalised Racism |Minyamum-Diversity has many Lenses

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