Banking isn’t for the faint of heart. The cash and cachet are impossible to beat, but being “the man” requires cruel tradeoffs. You’re paid for 80-hour work weeks, taking 1:00 a.m. conference calls, and surrendering weekends for deals that can flounder.
A few firms are taking note. They’re encouraging staff to spend dinner with their families and weekends away from the office. Goldman Sachs has been a pioneer in this movement, requiring analysts and associates to take Saturdays off. Apparently, they’re paying more than lip service to being a kinder, gentler firm. In the latest “Vault Banking 50” ranking, the industry named Goldman Sachs as the best bank to work for.
A PEOPLE’S CHOICE RANKING STRAIGHT FROM BANKERS THEMESELVES
“No matter what you think of Goldman Sachs,” says Derek Loosvelt, Vault senior finance editor, “there’s no denying that it’s become the main, if not sole innovator on Wall Street when it comes to workplace policies. Goldman was the first big bank to enact a protected-weekend-day policy for junior bankers and a no-working-past-midnight policy for interns. It was also the first big bank to revamp its promotion policy to fast-track junior bankers, the first big bank to modernize its performance review system, and the first big bank to widely use video interviews to recruit entry-level bankers.”
This shift at Goldman Sachs-—and other Wall Street blue chips-—isn’t rooted in pollyanna PR copy or manipulatable metrics. Instead, it comes directly from bankers themselves. Each year, Vault, which gathers market intelligence and ratings on employers and universities, surveys banking professionals at all levels. Using a scale of 1 to 10 (with 10 being the highest score), respondents score their firms in areas like work-life balance, internal mobility, and pay. In the process, respondents also score other firms on their “prestige,” which is code for attributes like closing big deals (and doling out hefty paychecks).
The 2017 Vault survey was conducted in the spring and summer of 2016. It generated roughly 3,000 responses from bankers, the same number as its 2016 survey. The data was then entered into a formula, with prestige given the greatest weight at 40%. The remaining attributes measured are firm culture (20%), compensation (10%), business outlook (10%), overall satisfaction (10%), work/life balance (5%), and training (5%).
GOLDMAN SACHS IMPROVES IN NEARLY EVERY EMPLOYMENT FACTOR
Goldman Sachs finished first (for the first time since 2011) thanks to improvements in several quality of life and work categories. Technically, Goldman Sachs ranked in the top 10 in 8 of 19 quality of life and work employment factors. Its highest scores actually came in client interaction (8.923) and the ability to challenge (8.825). Despite the lore surrounding its big paydays, survey respondents (i.e. employees) gave Goldman Sachs a 7.274 score, good for 15th behind UBS, Citi, and Bank of America (but far better than its 6.221 score in this area in Vault’s 2013 ranking).
However, Goldman Sachs’ work-life balance jumped from 7.065 to 7.360 in just the past year (and up from 6.896 in 2013). At the same time, employee satisfaction rose from 7.807 to 8.138 over the same period (with the firm scoring 7.728 in this metric four years ago). For Loosvelt, it was sweeping progress that was difficult to ignore. “Although I wasn’t all that surprised that Goldman ranked No. 1 in the Banking 50 again,” he explains in a written interview with Poets&Quants, “I was pretty surprised at how much its scores rose this year in several quality of life categories. In fact, Goldman’s scores rose in every category this year but one (business outlook, in which most scores at all firms fell due to the sour deal market). And many of Goldman’s increases were significant: nine percentage points in compensation, five and one-half points in hours, five points in informal training, and four each in work/life balance and overall satisfaction.”
According to survey respondents from Goldman Sachs, family, in particular, has taken on greater urgency at the firm. “The firm has a high respect for quality of life,” points out one employee who completed Vault’s survey. “The firm is also very supportive of families, and allows high levels of informal flexibility for parents. Weekend work is monitored and intended to be minimal for all, and many parents will leave early enough on weekdays to spend time with kids, and, if necessary, will log on later at night to finish work once children are asleep.”
DOES GOLDMAN SACHS RELY TOO HEAVILY ON ITS REPUTATION?
Despite such workplace policies, Goldman Sachs still has a ways to go to shed the sweatshop image that dogs the industry as a whole. In 2017, for example, the firm couldn’t crack the top 15 in terms of hours or vacation policy. However, the arrow is definitely pointing upwards, with recent Vault reviewers feting their firm for its “close knit environment,” “competitive but collegial and innovative atmosphere,” and “development and promotion opportunities.”
Diversity is another underrated aspect of Goldman Sachs’ appeal. Although it finished second to Loop Capital Markets in overall diversity and minority representation, it ranked first for women and the LGBT community. “The expansion of programs to build awareness and improve commitment of the firm to diversity, environmental, and philanthropic imperatives has been quite impressive over the past five years,” shares one respondent from Goldman Sachs. “From the 10,000 Women and 10,000 Small Businesses initiatives to the internal training and overall donation activity levels, the firm is a real leader on Wall Street in this regard.”
In reality, Goldman Sachs’ biggest asset is the name itself. For the 11th consecutive year, it ranked first in prestige with an 8.866 score from outside bankers, easily outpacing Morgan Stanley (8.093) and J.P. Morgan (7.990). Despite the honor, this score raises the annual question: Does Vault’s methodology give Goldman Sachs a built-in advantage since 40% of its rank remains stable year-after-year (an advantage also enjoyed by McKinsey in the Vault Consulting 50)? Like McKinsey, Goldman Sachs earns far higher marks from rivals outside the firm than employees within it, making the perception of excellence nearly as important as actually achieving it. Notably, Goldman Sachs doesn’t even crack the top 10 among its competitors in critical benchmarks like culture, leadership, business outlook, and overall satisfaction. This undertow indicates how the firm’s increased eye on their employees’ well-being only goes so far, with Vault reviewers still faulting the firm for its “stress,” “politics,” and “tight schedules.” That said, some issues cited may be the natural downsides to working in investment banking. “The intensity can be really high,” writes one Goldman Sachs employee,” as can the pressure and lack of time to pursue formal training.”
Go to next page to see the Vault 50 ranking.