Why the Goldman Sachs Resignation Letter from Greg Smith Lacks Credibility (& how to Resign with Dignity)
Greg Smith has become a bit of a cult hero for disgruntled white collar workers overnight, with his resignation letter from Wall Street investment banking firm Goldman Sachs in the form of a New York Times op-ed.
Mr. Smith, who spent 12 years at Goldman (10 in New York and 2 in London), decided to resign from his mid-level executive role because he believed that the company’s culture had morphed into one that valued profit before its clients and that this behavior was encouraged from the very top (to hear both sides, you can also check out Goldman Sach’s response).
If you haven’t noticed, I have a bit of “stick-it-to-the man” rebelliousness about me. Witness my Comcast, Steve Jobs, E-Trade, Black Friday, Americans are overworked, and consumer 12-step program rants, for starters. I don’t think this non-conformist attitude is all that uncommon amongst hardcore frugalites. It’s probably the rule, not the exception.
And with the financial crisis and ensuing Great Recession, there has been no love lost for Wall Street Firms. Especially Goldman, who has often been at the center of controversy.
Combine my rebelliousness with my disdain for Wall Street and Smith’s op-ed really grabbed my attention. It had the potential to put a much more critical eye on one of the world’s largest financial institutions by the public, government, its shareholders (the GS stock dropped 3% the day it was released), and its customers. Wall Street needs this level of enhanced scrutiny and responsibility.
But since the piece was published, my enthusiasm has waned because I think Mr. Smith’s credibility suffers for a four big reasons:
1. Tenure/Financial Motive
The fact that Smith was with Goldman for 12 years before leaving really damages his credibility. No doubt, as a mid-level executive for an investment firm for 12 years, with their reputation for high pay and handsome bonuses, Mr. Smith leaves Goldman as a very wealthy man (one can fairly assume he earned millions in his time there).
If Mr. Smith felt so strongly about the changing culture at Goldman, why did he wait so long to leave? Perhaps he was waiting to hit certain financial goals before deciding to move on with his career. It took him 12 years to figure out Goldman wasn’t the place to be? Not buying it.
2. He Hands Over Responsibility to Others without Taking Action
The fact that Mr. Smith has decided to go public about his distaste for Goldman’s culture without any mention of trying to be a champion for change internally in the company or raising these concerns directly with leadership, speaks to his cowardice and self-motive. He doesn’t say he decided to leave after tirelessly pursuing culture change and raising concerns with leadership. He was in a leadership position and no doubt had access to key company influencers.
Instead, he says “I knew it was time to leave when I realized I could no longer look students in the eye and tell them what a great place this was to work.” That’s it? And you write an op-ed for the New York Times as a result?
3. At Second Read, the Op-Ed Looked More Like a Resume than a Resignation Letter
Sprinkled throughout the op-ed are self promotional gems like,
“Over the course of my career I have had the privilege of advising two of the largest hedge funds on the planet, five of the largest asset managers in the United States, and three of the most prominent sovereign wealth funds in the Middle East and Asia. My clients have a total asset base of more than a trillion dollars”
“I was selected as one of 10 people (out of a firm of more than 30,000) to appear on our recruiting video”
“getting a full scholarship to go from South Africa to Stanford University, being selected as a Rhodes Scholar national finalist, winning a bronze medal for table tennis at the Maccabiah Games in Israel”.
We get it, you are a special guy. Wait, wasn’t this supposed to be a resignation letter instead of a resume?
4. He States the Obvious
There is nothing in his piece that is the least bit shocking or unexpected to the common American. Smith admits, “I don’t know of any illegal behavior”. A Wall Street investment firm that sells products out of its own best interests to customers? Welcome to capitalism, my friend. Wait, you’ve already been at the heart of it for 12 years? You’re a Rhodes Scholar finalist who had no idea what you were getting in to when you applied for Goldman Sachs?
These four things lead to Mr. Smith being what his UK statesmen would call a “bloody wanker”.
What can you do to avoid being like Greg Smith?
If you don’t like your employer, there are much more dignified ways to handle the situation. For starters:
- Be honest with yourself. Let’s face it – there’s only one reason to work for Goldman Sachs: money. Be honest about yourself when taking a job. You know what you’re going into when you apply to a Wall Street investment firm. Be honest with your expectations for the job you signed up for.
- Be an enforcer of change. If you see things you don’t like, put your own ass on the line and raise your concern with management. Be vocal, and don’t just fall in line and accept the status-quo. Be the guy/gal who is not afraid to address the elephant in the room. At the very least, you will keep your dignity. Corporate cultures go bad when people fall in line and don’t keep it real.
- Don’t work for a place you hate for 12 years, even if they pay handsomely. Go elsewhere, become self-employed, anything but stick around for 12 years as you watch the life slowly get sucked from your soul.
If those three things fail, then go write a New York Times op-ed and score a multi-million dollar book deal to help shed some light on your situation. You’ll need that money to fight years of lawsuits ahead.