Women and ethnic minorities make up almost half of the new crop of Goldman Sachs partners, lessening the dominance of white men at one of Wall Street’s most exclusive clubs in a year when admissions fell to their lowest level in decades.
Goldman named 60 new partners on Thursday, lower than the 69 promoted in 2018 and well below the around 100 typically named in biennial rounds in the era of Lloyd Blankfein, Goldman’s chief executive from 2006 until late 2018.
The latest group includes 32 white men, giving them a 53 per cent share of the promotions, the demographic’s smallest representation on record. The share of new partners from Goldman’s traditional powerhouses of investment banking and trading has also fallen to 66 per cent, down from 71 per cent two years ago.
David Solomon, chief executive, has resolved to shrink the number of partners and increase the financial perks they enjoy, as well as to broaden the make-up of the partnership to reflect Goldman’s evolving business, which is branching into areas including digital banking and cash management. The latest promotions also continued a trend of naming more partners from areas such as operations and risk.
“Goldman Sachs’ strong partnership ethos has always been at the heart of our culture,” Mr Solomon said.
Following the new elevations and a higher than usual number of departures in recent years the partnership now totals fewer than 440 in a company that employs about 38,000.
More than 20 years after a stock market listing dissolved its original partnership, Goldman bestows the title on its star performers, touting the practice as a differentiator from other big Wall Street groups in the battle to attract and retain talent.
Goldman partners receive a pay rise to a basic salary of $950,000 and exclusive investment opportunities, which have just been expanded to include “carried interest” in Goldman’s private investment funds. Carried interest, a share of the funds’ future profits, is taxed at a capital-gains rate that is typically much lower than recipients’ income tax rate.
Women make up 27 per cent of the new class, surpassing the previous record mark of 26 per cent in 2018. The bank said 17 per cent of the new partners were Asian, 7 per cent were black and 5 per cent were Hispanic or Latino.
Those who do make partner have a typical tenure of eight years, Goldman says, though a good proportion leave sooner, according to Financial Times research.
“I see this a bit like ‘Special Forces’ — the challenge is to become one, then you do it for a while and then you move on to do other fun stuff,” said one former partner, who left for a hedge fund six years after his promotion.
An FT analysis of the partner classes of 2010 to 2016 shows that 2010s partners left at the highest rate, with more than 18 per cent having departed within four years.
The class of 2012 were the least likely to leave, with just 10 per cent exiting in their first four years. Women were less likely to leave than men in every year.
One 2010 partner said the financial rewards of partnership were lower than he expected, and investment opportunities were less lucrative in the years immediately after the financial crisis.
Get alerts on Goldman Sachs Group when a new story is published