The “old boys’ club” culture that once permeated through the halls of investment banks and other financial firms has largely been eradicated over the last two decades. However, it appears one company never got the memo, or at least never bothered to read it. Lloyd’s of London is on the receiving end of a brutal new Bloomberg exposé that paints the insurance and reinsurance exchange as the “most archaic” place left in global finance.
The reporting details a deep-seated culture of sexual harassment told through the lens of 18 different women who worked at Lloyd’s, did business on its trading floors or who are veterans of the industry with close knowledge of the company’s inner workings. One insider described the exchange as “basically a meat market,” where female assistants are judged on their looks – or their “shagability” – and are graded on a 1-10 scale, according to another woman in the business. The anonymous allegations range from inappropriate remarks to sexual assault. Sources told Bloomberg that the culture is largely predicated on one thing: alcohol
“The London insurance market is the last place in global finance where drinking isn’t only tolerated, it’s expected.”
Underwriters are said to move from making deals to putting back stiff drinks, only to head back to the office and start the process over again. One of the assault allegations includes a male manager who was so drunk he was slurring his words. The inebriated man was said to have suddenly grabbed at a female executive during a shared cab ride to their respective homes, forcing her to break free and get out of the car. She filed a formal complaint and was moved to a different part of the business while the man remained in his same role.
Inga Beale, Lloyd’s first female chief executive officer, tried to turn the cultural tides when she took the reins in 2014, and eventually banned day-drinking for Lloyd’s employees three years later. While the ban was widely ignored, it did elicit many angry complaints from employees, including some who reportedly compared Beale to a mother trying to run their lives.
When Beale stepped down last year, she was replaced by John Neal, the former CEO of Australian insurer QBE Insurance Group. Neal previously had his pay docked by QBE for not disclosing that he was in a relationship with his personal assistant – who had replaced his former PA after the two got married, according to the report.
Elsewhere, the silver medalist in the race to succeed Lloyd Blankfein at Goldman Sachs may have just struck gold himself. Harvey Schwartz, the former president and co-chief operating officer of Goldman Sachs who left last year after David Solomon was named the bank’s new CEO, is reportedly in talks with the board of Wells Fargo to potentially take the reins from its current chief executive, Tim Sloan, according to the New York Post.
However, there are a few things standing in the way. First, Schwartz is said to be up against one other serious contender who is, at this point, unknown. Secondly, he’s said to also be considering opening a family investment office with Pablo Salame, the former co-head of Goldman’s securities division who left last year. Plus, sources told the Post that Schwartz doesn’t want to move to San Francisco or Charlotte, Wells Fargo’s East Coast hub. Then there’s the fact that Wells Fargo categorically denied being “in talks with anyone” to replace Sloan, who has the “unanimous support of the board.” Other than that, it sounds like a done deal.
Meanwhile:
Adjectives have become one of the biggest impediments for women in banking who are up for promotion. Different words are used to describe the same characteristics in men and women, according to Anu Aiyengar, J.P. Morgan’s head of North American M&A. While a man who is constantly asking his boss for direction or feedback may be described as “focused,” a woman who acts in the same manner may be dubbed “needy,” she said. (WSJ)
Deutsche Bank fell one spot to fourth in the investment banking league tables for EMEA in the second half of 2018. The region is now led by three U.S. banks: J.P. Morgan, Citi and Goldman Sachs. (FT)
Abu Dhabi’s $225 billion sovereign wealth fund, Mubadala, said it won’t do business with Goldman Sachs beyond its current contractual commitments. The fund blamed the Malaysian 1MDB scandal. (Breaking Views)
After taking a decade off, Wall Street CEO pay is back to pre-crisis levels. Chief executives at the six big U.S. banks took home roughly $152 million in 2018, up from the $141 million the firms paid their CEOs in 2008. (Financial News)
Activist investor Bill Ackman has toned down his headline-inducing bravado and is returning to the basics of investing following a few bad years that resulted in his private fund shrinking by $9 billion. “I went activist on Pershing Square,” he joked. (WSJ)
ExodusPoint Capital, the $8 billion hedge fund that has been poaching dozens of portfolio managers over the last year, has three more scalps to put on its wall. The firm just lifted a trio of traders from Carlson Capital, including Ivan Ross, its former head of fixed income. (Business Insider)
Smartphone addiction can lead to impaired decision-making in similar ways as other forms of dependency, including drug and gambling addictions, according to a new study. (The British Phycological Society)
Elon Musk’s SpaceX is building a rocket that can escort passengers from London to New York in 29 minutes. (The Sun)
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