In truth, Goldman didn't have much choice but to act. It has never shown much interest in flattering public opinion, presumably on the grounds that if it kept making piles of money then it didn't really matter what we proles thought. But the aftermath of the financial crisis has scuppered that theory. As CEO Lloyd Blankfein himself has admitted, the very fact that Goldman has continued to rake in the big bucks has caused widespread outrage. And after it emerged that it sold its own clients a derivative so complex that the trader in question didn't really understand it, while simultaneously betting that the product would fail, it couldn't even argue that it was always acting in the best interests of clients.
As a result, last year it established a new 'business standards committee' (an instructive move in itself), who have put together this new mission statement following interviews with more than 200 of the bank's clients. The focus seems to be on greater transparency with clients and investors - coming clean on conflicts of interest, and explaining exactly how the bank is making its money (it seems fairly extraordinary that it doesn't do this stuff already, but that's investment banking for you). What's more, new products like that dodgy derivative will be scrutinised by a 'new activity committee'. If the product could have an 'adverse reputational impact', it may be canned - even if there's a demand for it. That's very unlike the Goldman of old, where the question always seemed to be 'can we?' rather than 'should we?'.
Not everyone will be happy that Goldman is finally addressing its reputational issues. Shareholders may worry that it will affect the bank's ability to generate fat profits. And today's Lex column in the FT has fun with the notion that all these committees will result in 'slow strangulation' for the banking industry - death by meetings, you might call it.
But although some have argued that this is a little more than a PR stunt, we’re inclined to the glass-half-full view. If Goldman is forced to be more open about the way it does business, it should also be forced to cut down on some of its more unappealing excesses. This mission statement won’t transform its reputation any time soon, but at least it’s 39 steps in the right direction.