Greg Smith’s Letter of Resignation

March 19, 2012 · Posted in Blog · Comment 

Greg Smith wrote a letter of resignation but unlike most employees, rather than sending it to his boss, he sent it to the New York Times. The Times might not have printed it, where it not for the company he worked for – Goldman Sacks, a world leading financial institution – and the fact that he was an executive director. In his letter, “Why I am leaving Goldman Sacks” he did not hold back. He describes a place that he once loved, having lost its moral compass. To be a leader in the firm means

“persuading your clients to invest in the stocks or other products that we are trying to get rid of because they are not seen as having a lot of potential profit”

and getting your clients to,

“trade whatever will bring the biggest profit to Goldman” even if it means getting your clients products they won’t really want.

Mr Smith may simply be expresses the negative feelings that any former employee might feel on leaving a company they no longer want to work for, perhaps because they do not feel properly rewarded. But one cannot help wonder if anything has changed in the global finance industry. Clearly a lot has changed in the economies of the world, and major changes are rippling through many sectors of public services in the UK. But are the right kind of values, attitudes, virtues or professional ethics being encouraged in the firms that will determine whether the world will face yet another financial meltdown, is not at all clear. We might have expected a major set of changes to the regulation of the financial services and banking industry, after what has happened. But such changes are not at all clear. More than that, do we accept that professional ethics, codes of conduct and moral considerations have a place in business and professional life?

Has it become up fashionable to make moral comments? Is it somehow out of place to say when you think something should not be the way it is, or to argue that a certain characteristic is desirable, over and above others? Only time will tell whether or not the culture of greed and unrestrained and unreasonable risk taking that drove the economies of the world to the edge of the cliff, have in any way be seriously challenged or curtailed. But for the present, Greg Smith’s letter gives little comfort for such a hope.

Greg Smith’s Letter