“What does ‘aggressive’ mean, other than obnoxious?” asked Rana Yared at a recent conference. As a partner on the prestigious Principal and Strategic Investments team, she was on a panel representing Goldman Sachs at the Fortune “Most Powerful Women Next Gen” conference, discussing the perennial topic of gender balance at the highest levels of investment banking. It’s a good question – although the word is ubiquitous in job descriptions and promotion cases across the industry, if you were to turn up at an investment bank and actually start being aggressive to people, you would most likely be put in your place pretty quickly. What banks are really looking for are people who are “energetic, persistent and determined to generate revenue”.
But it turns out that if you use the word “aggressive” to describe these qualities, potential female applicants read it as having the sense “this job is for men, preferably ones who think they’re Navy SEALS”, and then don’t apply. According to Ms Yared, when she and her co-partner decided to get rid of the “A-Word”, they started a process of change which led over time to their achieving the unusual status of having 50/50 gender balance at every level of their team, from analysts up to partners. (This was then rebalanced somewhat; the Principal and Strategic Investments team was created by the merger of Ms Yared’s Merchant Banking Division and the somewhat more male Special Situations Group. But presumably the project continues).
It might seem slightly too good to be true that changing a single word can solve all your problems. And indeed, it seems to be not so much about the word as the whole mindset. Ms Yared said that “aggressive” was removed from the entire vocabulary of recruitment and promotion, not just from job descriptions. Instead of “is this candidate aggressive enough”, the senior staff started to ask “are you intellectually curious, are you assertive when you form a view, do you have an insatiable desire to learn, and can you articulate your view with training?”, and presumably some other questions aimed at eliciting the key information about willingness to work incredibly hard.
Obviously, this is a small sample, and results achieved in a highly sought-after team in Goldman’s particular corporate culture might not necessarily generalise to the industry as a whole. But it makes a lot of intuitive sense; “aggressive” is by no means the only language which has this problem where a stereotypically male quality (and not necessarily a desirable or even relevant one) is used as shorthand for what the job really requires. Who would really want to work in the company of hungry alpha male rockstars who eat what they kill and are obsessed with the league table? It sounds like the worst reality TV show ever.
Banks do need their people to have something special though. When your intellectual curiosity wears thin, three hours into a four hour conference call, whatever it is that keeps you engaged might be called “aggression” or “competitive spirit”, although there’s no literal fight to be had. Passion and resilience might be less gender-sensitive ways of describing it.
Elsewhere, Bloomberg has crunched the numbers and concluded that it’s entirely possible that Citadel Securities, the sellside equity market making firm, might be generating more money for Ken Griffin than his significantly more famous hedge fund. Market structure experts seem to suggest that the key to its ability to generate profit margins of as much as 30% is that Citadel Securities is able to take directional views about where the market is going rather than being confined to millisecond-long arbitrage opportunities.
In many ways, Citadel Securities looks like a 21st century version of a traditional trading desk, with “flow” and “proprietary” trades supporting one another. This is exactly the kind of business that big banks can no longer do; the prop trading side of it is banned by post-crisis regulations. Almost inadvertently, Mr Griffin appears to have been handed a Tupperware box belonging to Wall Street, and after ten years since the launch of Citadel Securities, he is able to thoroughly enjoy the lunch inside it.
Credit Suisse investment banking will end the year with a pretax loss, and group profitability targets have been reduced … (FT)
…but the bank intends to keep shareholders happy with buybacks and dividends, and potentially some more cost cuts if the revenue environment continues to weaken … (Finews)
…But that doesn’t appear to be their central scenario. Noting that 2019 was an unusually bad year for their having been involved in big deals that got voted down, failed to get regulatory approval or otherwise didn’t happen, CS announced that it was still ready to make “incremental hires” in M&A and capital markets. (Financial News)
More stories of bickering and waiting in conference rooms, as the blame game begins over the communication of investor feedback to Aramco over the viability of the $2trn valuation management wanted. Apparently some of the world’s most senior bankers were told they weren’t allowed to speak in meetings, as punishment for raising awkward issues (Bloomberg)
Art investment goes bad – a $11m painting has been judged to be a fake and its hedge fund owner has to give Sotheby’s their money back (Business Insider)
It hasn’t been officially announced, but people are not referring to Noel Quinn as “interim” CEO as much any more. In the course of a profile, it’s revealed that his predecessor John Flint used to get back pain so severe that he needed a belt and an ice bucket to get through meetings that he was chairing. (Bloomberg)
A joint venture between Credit Suisse and Palantir was meant to develop software to detect rogue traders. Instead, it’s generated a small scandal of its own; an alleged whistleblower claims she was taken for “a walk around the block” to put pressure on the auditors over revenue recognition. CS and Palantir both deny this and the court case is pending (NBC)
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