Does Culture Matter? Ask Goldman Sachs

If you think company culture built on solid values isn’t important, take a look at what Goldman Sachs is dealing with today.

In a New York Times op-ed, company executive Greg Smith tells why he is leaving the company — and it isn’t pretty. He delivers a scathing indictment of the company’s culture, which he says has devolved from one of integrity and doing the right thing to one in which the only thing that matters is making a profit. As if any financial services company needed this kind of press right now.

“It astounds me how little senior management gets a basic truth: If clients don’t trust you they will eventually stop doing business with you,” Smith writes. “It doesn’t matter how smart you are.”

He adds:

I hope this can be a wake-up call to the board of directors. Make the client the focal point of your business again. Without clients you will not make money. In fact, you will not exist. Weed out the morally bankrupt people, no matter how much money they make for the firm. And get the culture right again, so people want to work here for the right reasons. People who care only about making money will not sustain this firm — or the trust of its clients — for very much longer.

A company’s culture does matter — not only to the people who work there, but ultimately to its customers. Garbage in, garbage out. If your business is built on the sands of profit at any cost, it will eventually come crashing to the ground.

This op-ed also serves as a warning to business leaders who think they can keep such betrayal of corporate values inside the family. The age of social media has made employees a lot more brazen. They will air your dirty laundry and it will go viral, just as this article is.

Years ago, I parted ways with a company I believed in because my boss asked me to do something that violated my professional standards. What he asked me to do wasn’t illegal, but I just couldn’t do it and continue to function in my role with a clear conscience. I strongly believed my boss’s behavior — and my dismissal after challenging it — also violated the company’s stated values.

If enough people feel that way often enough, sooner or later a company will see talented and engaged employees looking to work elsewhere. And that is a real business problem.




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