(Bloomberg) -- Goldman Sachs Group Inc. plans to add the most executives to its partnership since David Solomon took over.
The promotions to be announced this week will exceed the previous high of the Solomon era, set in 2022, when 80 employees made the cut, according to people with knowledge of the matter. The moves are part of the bank’s biennial ritual to tap a select few to join the ranks of 1-percenters at Goldman Sachs.
The Wall Street firm stands out from its peers in retaining a nod to its pre-public days as a partnership by maintaining that title as its highest rank. A little more than 400 executives are part of the group — less than 1% of its workforce.
A spokesperson for Goldman declined to comment.
The new wave of promotions reflects a shift for Solomon, who rose to chief executive officer in October 2018 and immediately highlighted smaller partner classes as the preferred outcome — to reinforce the “aspirational nature” of the rank and to refurbish its standing as one of the most exclusive clubs on Wall Street. A month into his tenure, the bank elected 69 new partners and followed it up with just 60 in 2020, the fewest since Goldman’s 1999 initial public offering.
The firm has been bulking up those ranks since then, in part to replenish the partnership pool to account for executives leaving for more lucrative gigs outside of banking. But Goldman has also enjoyed a spell of breakout performance, especially within its investment bank, that has ratcheted up pressure on its leaders to reward a bigger pool of employees.
The bank is also grappling with a lack of gender parity in its top ranks, which is harder to address with smaller partner classes, even if new groups are more diverse. The current cohort is still dominated by men, with women accounting for less than 1 of 5 partners at the start of the year.
Gaining entry into the club is a necessary springboard to jump into even more prominent management roles, where Goldman has had a paucity of women.
Goldman’s headcount has also swelled by 17% to 46,400 under Solomon as the bank beefed up staffing in more cost-effective locations such as India, while giving those employees roles that go beyond back-office functions. As those places grow in importance, the firm sees the need to promote people in locales far from its New York headquarters, one of the people said.
Rich Rewards
The overall size of the partnership relative to total headcount is still smaller than in the years before Solomon took the top job.
The most executives Goldman has ever added to the partnership was in 2006, when 115 people were tapped to join the group. At the time, Goldman was much smaller but held the bragging rights of being the securities industry’s most profitable firm.
The partnership rank comes with special privileges, including pay that routinely climbs into several millions of dollars, the opportunity to invest in private funds without fees and a cut of profits from Goldman’s investment funds that are open to employees.
They also stand to be at the front of the line for non-routine awards such as those partners received for the bank’s post-pandemic windfall. After raking in almost $22 billion of net income in 2021, reeling in profits as markets rebounded and a dealmaking frenzy took hold, Goldman delivered special one-time payouts — only for its partners.
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