Goldman Sachs announces promotion of 608 new managing directors, a decrease from 2021 numbers

In a recent development, Goldman Sachs, the renowned Wall Street firm, announced its plan to promote 608 executives to the position of managing director in 2023. This number reflects a slight decrease from the 643 senior bankers promoted to this position back in 2021.

Goldman Sachs follows a biennial tradition of revealing managing director promotions, and the 2023 count is the lowest since the promotion of 465 individuals back in 2019, which was before the global pandemic.

The breakdown of these new managing directors reveals that 47% have been promoted from Goldman's traditional strongholds in investment banking and trading. Meanwhile, 24% have been sourced from asset and wealth management, with 2% coming from platform solutions.

The timing of these promotions coincides with Goldman Sachs experiencing a series of high-profile departures. Most notably, Julian Salisbury, who served as the chief investment officer of asset and wealth management, is excited to join investment firm Sixth Street. Furthermore, the bank made significant staff reductions earlier in the year, marking its most substantial downsizing effort since the 2008 financial crisis.

A noteworthy aspect of these promotions is the record-breaking 31% of women among the new managing directors, a slight increase from the 30% representation in 2021. However, progress in terms of racial diversity has slowed, with black employees making up only 2% of managing directors, a notable decline from 5% in 2021. Similarly, Hispanic or Latino staff accounted for 4%, down from the 5% recorded in the previous year.

In response to these statistics, a company spokesperson emphasized their commitment to achieving greater diversity, stating, "We remain committed to achieving our aspirational goals and increasing representation at all levels of the firm. While we've made progress in developing a diverse pipeline of talent, we recognize there is much more work to be done."

Additionally, approximately 3% of the newly promoted managing directors identify as part of the LGBT+ community, a statistic unchanged from the previous year. The group of managing directors also saw a record 31% representation of Asian individuals, up from 28% in 2021.

The company memo, attributed to CEO David Solomon and President John Waldron, underlines that the 2023 promotions align with the firm's ongoing focus on advancing its strategic objectives and continuing to invest in its global presence to remain closely connected with clients worldwide.

The news of these promotions follows a period of departures and job cuts that accelerated after Goldman Sachs restructured its business into three distinct units the previous year. The bank also scaled back its ambitions for its consumer business, which had incurred significant losses totaling $3 billion over the past three years.

Interestingly, recent improvements in the capital markets environment have fostered a conducive atmosphere for major listings in the United States, as exemplified by the listing of Arm Holdings. Additionally, Goldman Sachs played a key advisory role in the $60 billion acquisition deal between Pioneer Natural Resources and ExxonMobil.

Mergers and acquisitions, as well as initial public offerings, faced challenges last year, primarily due to factors such as the Russian invasion of Ukraine and the Federal Reserve's assertive rate hikes aimed at curbing inflation.

Despite these dynamics, Goldman Sachs reported third-quarter profits that, although lower than expected, benefited from a nascent revival in deal-making. Nevertheless, the bank had to contend with an $864 million write-down linked to its GreenSky fintech business and real estate investments.