Goldman Sachs was one of the investment banks involved in the2008 financial crisis. It sold mortgage backed securities, calledcollateral debt obligations (CDOs) to thousands of investors. Itsemployees reaped lucrative commissions selling CDOs.
Four years after the crisis, Greg Smith, head of Goldman Sachs’U.S. equity derivatives business in Europe, Africa and the MiddleEast, resigned. He wrote an opinion piece, published in the NewYork Times on March 14, 2012, about his resignation after 12 yearswith the bank.
He wrote about an appalling deterioration in the firm’sorganizational culture. Formerly, it had centred on “teamwork,integrity, a spirit of humility, and always doing right by ourclients. The culture was the secret sauce that made this placegreat and allowed us to earn our client’s trust for 143years.”
Smith found the modern culture destructive and toxic. He blamedsenior managers for shifting away from worrying about what was bestfor the clients, into focusing on what was the most profitable forthe firm. “Leadership used to be about ideas, setting an exampleand doing the right thing. Today, if you make enough money for thefirm (and are not currently an ax murder) you will be promoted intoa position of influence. … It makes me ill how callously peopletalk about ripping their clients off. Over the last 12 months Ihave seen five different managing directors refer to their ownclients as ‘Muppets’, sometimes over internal email.”

He said that, currently, there were three quick ways to becomesuccessful at Goldman.
1.Persuade clients to buy investments that Goldman was trying toget rid of because theywere unprofitable.
2.Persuade clients to buy products that that were profitable forGoldman to sell, rather thanproducts that best suited the needs ofthe client.
3.Sell illiquid or opaque products, especially those withthree-letter acronyms, that aredifficult to understand and may notbe aligned with the client’s goals.
He concluded his op-ed with a plea for the board of directors torefocus the firm’s culture back to what it was when he first joinedGoldman Sachs, twelve years ago.

What is ethical leadership? (200 words)