Goldman Sachs CEO David Solomon faces increasing heat over his sharp-elbowed management style, flopped business ventures, and a stampede of top talent out of the firm — and senior bankers are reportedly testing the loyalty of his No. 2 executive.
President and Chief Operating Officer John Waldron has climbed through Goldman’s ranks behind Solomon since joining the firm in 2000, making him CEO-in-waiting of the investment bank.
As partners grow increasingly frustrated over their skimpy bonuses, Solomon’s private jet use, and his side hustle as a DJ, they’re left wondering if Waldron will have the opportunity to step out of Solomon’s shadow and forge his own path.
“What do you do if you happen to’re the No. 2?” questioned former Goldman partner Robert Mass, who spent 27 years at the corporate, in response to Bloomberg. “Do you distinguish yourself and show you’re different, or do you show support?”
In July, Waldron sparked rumors of a leadership handoff in a conversation with senior dealmakers within the Hamptons about Goldman’s current challenges, in response to Bloomberg.
Waldron said that whoever is on the helm in two years will likely sit atop a much cleaner firm, which triggered a flurry of theories amongst Goldman bankers as as to if Solomon was planning his handoff, the news service reported.
Goldman Sachs partners frustrated over David Solomon’s skimpy bonuses, private jet use, and side hustle as a DJ are left wondering if his No. 2, John Waldron, would make a superb fit as his successor.REUTERS
An organization spokesperson told The Post that Waldron’s remarks were misconstrued by colleagues, and he was actually referring to when the firm would deliver more stable returns.
“The leadership team is targeted on executing our strategy and the performance of the business, not on speculation,” company spokesperson Tony Fratto said.
Waldron, 54, is reportedly more diplomatic than Solomon, 61, who is not any stranger to dismissing critics who aren’t keen on his daring, yet ill-fated foray into consumer banking.
Over the past yr, Waldron has been an incredible listener to colleagues’ qualms, acknowledging their frustrations without blatantly backstabbing his boss, Bloomberg reported.
Solomon and Waldron have old ties that run deep, first working together at Bear Stearns within the early Nineteen Nineties, where Waldron began his profession as an investment-banking analyst as Solomon was already a brusque leader of the firm’s junk bonds division.
Solomon left Bear Stearns for Goldman in 1999 and recruited Waldron to affix him on the bank one yr later, in response to Bloomberg.
In 2018, Goldman’s board named Solomon the top honcho, and he appointed Waldron as the only real president.
Solomon reportedly lured Waldron to Goldman after the 2 worked together at Bear Stearns within the early ’90s. After Solomon was elected CEO by the bank’s board in 2019, he appointed Waldron as the only real president.REUTERS
Waldron has been a loyal servant to the Wall Street behemoth throughout his 22-year tenure, even turning down a proposition from private equity firm Carlyle Group last yr when its CEO Kewsong Lee made a sudden exit from the firm, in response to the outlet, making him an obvious candidate for Solomon’s successor.
Nonetheless, there’s still a likelihood that Waldron could meet the identical fate as Gary Cohn, who served as Goldman’s president and co-COO alongside Solomon starting in 1990.
After spending 26 years on the firm, the highest dog spot slipped through Cohn’s fingers and went to Solomon.
Under Solomon’s rule, the 154-year-old bank has shattered all-time records, including in 2021 when Goldman reported a 66% surge in third-quarter earnings, to $5.28 billion, after riding a tidal wave of M&A activity that boosted profits and had the firm struggling to address transaction volumes never seen before.
Goldman has laid off 1000’s of staff and slashed Solomon’s salary by 30% amid a flurry of dismal earnings reports that saw revenues slumping by 48% yr over yr.Reuters
Nonetheless, the lucrative moment was short-lived, and Solomon has since been recording slumping revenues and flopped business ventures. Last month, Goldman reported dreadful second-quarter earnings, which fell by a whopping 58%.
It was just the newest in a series of brutal earnings reports that saw Goldman’s net income drop 48% yr over yr in 2022, to $11.3 billion.
Consequently, Solomon’s salary was slashed to $25 million — a 30% drop from 2021, and the firm laid off 1000’s of staff to offset its slumping revenues.
Solomon’s compensation includes an annual $2 million base salary and $23 million in variable compensation — $16.1 million of which is issued in restricted stock units. Meaning the payment won’t be available for several years, in response to a publicly available filing.
