C-Suite shake-up? | Goldman Sachs urged to split CEO & chairman roles amid 'conflict of interest' concerns

Goldman Sachs urged to split CEO & chairman roles amid 'conflict of interest' concerns

Goldman Sachs has been urged to split the CEO and chairman roles held by David Solomon, in addition to calling on shareholders to reject the bank's executive pay plans.

As reported by Reuters, independent proxy advisors, Glass Lewis and Institutional Shareholder Services, recommended in separate reports this week that investors back a shareholder resolution calling for the job split.

An independent chair "is nearly always preferable to having a single individual lead both the board and the executive team," Glass Lewis wrote in a statement, reiterating a recommendation from last year.

The proxy advisers have also urged the Bank of America to follow suit by splitting the CEO and chairman roles held by Brian Moynihan.

"Appointment of a chair of the board who is independent of management, i.e. not also serving as CEO, is nearly always preferable to having a single individual lead both the board and the executive team," Glass Lewis said.

After the 2008 financial crisis, investors seeking to improve risk oversight mounted efforts to separate the chair and CEO roles at Goldman and other Wall Street giants like JPMorgan Chase.

Banks often fended these off by making other changes, such as giving new powers to a lead independent director, which Goldman did in 2013.

Investors are again focusing on potential conflicts of interest posed by the two roles.

Solomon was named CEO in 2018 and added the title of chairman the next year. ISS cited Solomon's leadership and the bank's strategy in its recommendation to split the CEO and chairman roles.



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