After 12-plus years at the helm of Wall Street heavyweight Goldman Sachs, chairman and CEO Lloyd Blankfein will be stepping down from his position, possibly as early as the end of 2018.
In light of the news that Goldman Sachs co-president Harvey Schwartz will be stepping down next month, co-president David Soloman is widely assumed to be named as Blankfein’s replacement, and he will serve as the firm’s sole president and COO moving forward.
Blankfein is carefully managing his own exit and will be going out on top, senior associate dean for leadership studies at the Yale School of Management Jeffrey Sonnenfeld told Chief Executive.
“Lloyd Blankfein’s 12-year career has been as superb a run as any financier has enjoyed, with just one or two bumps along the road,” Sonnefeld says. “Blankfein has skillfully guided the firm through some troubling times in financial markets, piloting it into soaring success. He is revered by his peers, competitors, clients and employees.”
The succession would allow the next CEO to build a legacy of their own at Goldman Sachs.
“This firm, while a public company now, still has a wonderful private partnership collegial ethic and is likely to want to give the next team a chance to take charge and build a legacy, as well,” Sonnenfeld says.
“Blankfein encouraged people to think more broadly about their business and their lives as they climbed the career ladder.” – Jeff Cunningham
While specifics on Blankfein’s exit timeline and his future role, if any, with Goldman Sachs have yet to be unveiled, the fact that he is calling the shots on his own departure and leaving a large window of time for transition is providing Wall Street with some comfort in the situation.
“[Blankfein] is no monarch relying on some late-life, feet-first exit,” Sonnenfeld says. “He is co-piloting this on his own schedule with no pressure or drama, which is why the stock market has reacted favorably but calmly. It is not clear whether he would leave the firm at year’s end or step down as day-to-day CEO to a chairmanship role.”
The 63-year-old Blankfein joined Goldman Sachs in 1982 and has served as chairman and CEO since 2006, steering the firm through the 2008 financial crisis and coming out a bit bruised, but still intact. Over the course of his career he managed Goldman Sachs’ Currency and Commodities Division, as well as its Fixed Income, Currency and Commodities Division and Equities Division.
Blankfein’s leadership style as CEO stands out among his peers, according to professor of leadership at Arizona State University’s Thunderbird School of Global Management Jeff Cunningham.
“Blankfein encouraged people to think more broadly about their business and their lives as they climbed the career ladder. It meant not just doing good things for others, however, which might sound a bit too schmaltzy for a Wall Streeter,” Cunnhingham told Chief Executive. “There was a second part he was conveying, which was the dictum to rebuild a partnership culture in the public company as a way to enhance your own sense of moral judgment. It is one in which you take responsibility for your actions and your partner’s, and subject them to a deep due diligence so that even as a public company, as Blankfein told me, ‘we carry our partnership culture into the public company so we have an ownership culture.’ Lloyd Blankfein devoted his career to letting the world he never forgot what matters.”