Goldman CEO Solomon softens on returning workers to offices

Consultants and an employee survey are being utilized to gauge worker sentiment

David Solomon may be softening his hardline about when he wants Goldman Sachs employees back at the office, FOX Business has learned.

On Wednesday, Solomon and top Goldman partners met with consultants about plotting a return to the office and how it might include new technology, like Zoom, which allows people more freedom to work remotely as well as in the office.

FOX Business has also learned that the company is conducting an employee survey to further gauge sentiment about returning to the office. The firm wants to gather data on how employees have mixed business and personal issues while working remotely. The survey will also help Goldman assess what jobs can be done remotely without spending significant time in the office.

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No firm timetable will be enacted by Goldman until the survey is completed and Solomon fully explores the consultant’s recommendations— a shift for the firm and its CEO who just weeks ago took a hardline in suggesting Goldman’s 38,000 employees would return people to the office more immediately.

Speaking at a banking conference In February, Solomon caused a stir among his employees and even rival banks when he called remote work during the coronavirus pandemic an "aberration" that he was planning to "correct as soon as possible" even as the receding pandemic remains a major health problem in big cities like New York.

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The remarks put Goldman’s workforce on notice that the firm was adopting possibly the fastest return-to-office approach on Wall Street. Most other banks such as JP Morgan have given their employees vague timetables about when this year or next they might be expected back in the office given the slow rollout of COVID-19 vaccines and the receding but continued pandemic.

Solomon’s comments also caused a stir inside the prestigious investment bank given his own COVID work routine. While Solomon is known to spend significant time at Goldman's lower-West Side space, he is also known to work from home, including his mansion in the Bahamas, and use the firm's private jet to get there.

A Goldman Sachs spokeswoman declined to comment on the matter, but wouldn't deny that Solomon may be tempering his approach to bringing employees back full-time based on input from the employee survey and the consultants.

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The spokeswoman also pointed to remarks Solomon made last week at a global town hall where he stated that Goldman is "always going to give our people the flexibility they need to manage their time and their personal lives. We're not going back, we're going forward, and we're bringing with us many of the lessons we've learned from this past year’s experience."

He added: "We know from experience our people do their best when they forge close bonds with their colleagues. There are many ways to do that, but we found the best way is to work together in person on a regular basis. Until more of us are vaccinated, that's going to be a challenge, but based on the current pace of vaccinations and where we hope to be by the summer, we believe that we're well-positioned, and there's a good chance that we can meet that goal.”

Solomon has been CEO of Goldman for nearly three years. He took over the firm when its profits were sagging and its business model increasingly questioned by investors. Last year he earned $17.5 million in compensation, $10 million less than the $27.5 million he earned in 2019. The decline in pay is largely related to compensation cuts most executives and some employees endured during the pandemic and the subsequent lockdown of vast portions of the U.S. economy.

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Even so, Wall Street, and Goldman in particular, fared well during the past year. With the Fed slashing interest rates, Goldman's vaunted trading desk cranked out strong revenues -- up 23% year-over-year in 2020. Plus, a rising stock market led to significant deal-making that propelled the firm's investment banking division to record revenue in 2020 of $9.42 billion. Total net revenues for the bank hit close to $45 billion in 2020 -- almost $10 billion more than it made in 2019.

Goldman's stock price has skyrocketed 140% since this time last year, closing today at $344.95.

“Solomon took over Goldman when it was a mess. He turned it around and made it one of the most exciting companies in America,” veteran bank analysts Dick Bove of Odeon Capital Group tells FOX Business. “The fact he wants to use the company jet as his private plane? So what.”

Still, a recent story in Bloomberg detailed how Solomon's management style -- he can be abrupt and demanding -- as well as his use of the company jet, is rubbing some of his employees the wrong way.

That might account for what some people say is Solomon now slow-walking Goldman's return to work timeline since many employees believe they can do their jobs remotely without the hassle of commuting into the office.

Goldman Sachs Group CEO David Solomon may be softening his hardline about when he wants employees back at the office, FOX Business has learned.. (Photo by Michael Kovac/Getty Images)

Wednesday's partner meeting with work consultants centered on the mental health challenges and isolation of working from home as well as some of the benefits of spending more time with family and traveling less, people familiar with the matter say.

The experts, who have also consulted with tech companies including Google and Amazon, focused on understanding what areas of Goldman's business need to be conducted in the office and what jobs can be done just as effectively remotely.

Meanwhile, Goldman's employee survey is primarily focused on gauging the employee reaction to returning to the office as opposed to working remotely.

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Goldman, of course, isn't the only big bank grappling with how to return to full office capacity --and whether it's even necessary since technology advancements allow for remote conferencing. The changes allow for slashed travel budgets and questions about the need for expensive office space in cities like New York.

What makes Solomon different though is that he called into question the productivity of his workforce, concerned they are carrying out their jobs remotely with minimal oversight. Still no decisions are expected until Goldman finishes collecting the survey data and receives updated details on the vaccine rollout.

But already movement is afoot at the bank to bring people back. Goldman does plan on having interns in the office and some staff at work managing them starting in the summer.