The public resignation letter by Greg Smith, a Goldman executive, is lighting up the blogosphere. It’s certainly not the way Jake Siewert imagined spending his first day on the job as head of communications.
As a candid, personal confession from a Goldman insider, the letter is very damaging. It counters the notion that Goldman has been a united force, its people standing arm-in-arm to defend the firm against unfair criticism. Now we know that some inside the firm agree with the critics – and are willing to go public.
But it’s also likely to bring supporters of the firm forward. Look for their letters in the days to come.
There’s always more to a story like this than meets the eye. For one thing, Mr. Smith wasn’t a managing director, considered the elite of the firm. After a dozen years at Goldman he certainly would have been considered for a promotion to managing director. Did his squeamishness about Goldman’s money-making keep him off the list, or was it something else?
So what should Jake Goldman do now? A short note to its staff from Lloyd Blankfein reiterating the firm’s principles is the right course. There’s noting to be gained by taking on Mr. Smith in public or starting a campaign to rally supporters.
What the Goldman board should do, however, is another question entirely. It wouldn’t be surprising if it now looks more closely at the timing for naming Goldman’s next chief executive.