According to the New York Times, “As it prepares to pay out big bonuses to employees, Goldman Sachs is considering expanding a program that would require executives and top managers to give a certain percentage of their earnings to charity.”
The New York Times article says that for their work in 2008, 953 Goldman employees were paid more than $1 million each. The average annual income of Goldman Sachs employees is reported to be $595,000 (U.S.) and the company has good reason to believe that such high salaries simply aren’t acceptable to the public today.
An editorial in today’s Globe and Mailtitled ” Charity begins from pay“, states “It is unfortunate that Goldman Sachs feels it must set a mandatory standard for its highest earners. But if that is what it takes to have people fulfill their responsibilities to society, it is a message that should be heard around the world.”
I agree that it’s unfortunate that this needs to be mandated. I also think that employees who voluntarily agree to either reducing their salaries or contributing to charity should be recognized in some meaningful way.
The overarching question is: will this initiative change the public’s perception of Goldman Sachs? I think earning the public’s support will take much more than charitable donations from top earners. While it’s a good start, this is a company in urgent need of a compelling social purpose.
This company (along with its competitors) has helped to create the culture of stock market capitalism that fed ultimately resulted in a global financial crisis of unprecedented proportions.
The bigger opportunity, perhaps responsibility, is for Goldman Sachs to rewrite the rule book to establish the social and financial value of who it is and what it does.
Today, ROI signifies return on integrity as much as return on investment,