Bocconi Students for Sustainable Finance

PLAY HARD, WORK HARDER: the Investment banking approach

In 1994, Brian Mullen, now Chief Executive Officer and Managing Director at Coady Diemar Partners, provided an interesting definition of “being busy”: “You’re “busy” if you are working each weekday at least 16 hours and at least 16 hours on the weekend”. Keeping in mind the events of the past weeks: would you consider this position shareable? The investment banking world is currently divided on the topic. Mullen himself has affirmed that his view was applicable only to the investment banking industry of the 80s and the 90s, an industry that registered 20 per cent growth per annum and much higher margins than today’s one.

However, the past month has showed us how things have not changed: first-year Goldman Sachs analysts started reporting tiring average 15-hours working days, which, they say, led them to a non-eating nor showering, just working life. While some people in the industry defined today’s junior investment bankers “a generation of moaners”, supporting the thesis that in order to succeed it is necessary to work hard, others underline the fact that a very relevant aspect has to be considered nowadays: Covid-19.

Indeed, even though shifts are known to be so long in companies such as Goldman Sachs, before the pandemic spread, bankers could still enjoy a short coffee break with their fellow colleagues and exchange tips or ideas. However nowadays, being forced at home, junior analysts report being constantly monitored through a screen and being afraid of not working enough, without having the possibility of socializing.

By now it is evident how Covid-19 has affected our lives damaging the mental health of many people, regardless of their age, but, especially in the job market, the question still is: working that much will really lead to a better output? Mel Newton, head of financial services workforce consulting at KPMG, strongly believes in quality over quantity: he argues that it is nearly impossible to be active and productive for 15 hours straight and that taking a break from work would result in better performances. Statistics speak clearly: 64% of global business leaders affirmed flexible working had a positive impact on productivity.

Thus, big investment banks have started reconsidering their approach to tiring and long shifts, by introducing, for example, the “Saturday rule” (forcing junior bankers to take Saturday as a free-from-work day) or “Zoom-free” Fridays. The real question now becomes one: are these approaches really working? Different data show that companies are only promoting a do-goodery façade: taxi rides among 10 investment bank headquarters in New York City have significantly decreased on Saturdays while increasing late at night during the other days of the week.

For the moment it is an open question whether the situation will improve or not, but it is sure that investment banks have now the world’s eyes on them.

Author: Emma Gugliotta

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PLAY HARD, WORK HARDER: the Investment banking approach

In 1994, Brian Mullen, now Chief Executive Officer and Managing Director at Coady Diemar Partners, provided an interesting definition of “being busy”: “You’re “busy” if you are working each weekday at least 16 hours and at least 16 hours on the weekend”. Keeping in mind the events of the past weeks: would you consider this position shareable? The investment banking world is currently divided on the topic. Mullen himself has affirmed that his view was applicable only to the investment banking industry of the 80s and the 90s, an industry that registered 20 per cent growth per annum and much higher margins than today’s one.

However, the past month has showed us how things have not changed: first-year Goldman Sachs analysts started reporting tiring average 15-hours working days, which, they say, led them to a non-eating nor showering, just working life. While some people in the industry defined today’s junior investment bankers “a generation of moaners”, supporting the thesis that in order to succeed it is necessary to work hard, others underline the fact that a very relevant aspect has to be considered nowadays: Covid-19.

Indeed, even though shifts are known to be so long in companies such as Goldman Sachs, before the pandemic spread, bankers could still enjoy a short coffee break with their fellow colleagues and exchange tips or ideas. However nowadays, being forced at home, junior analysts report being constantly monitored through a screen and being afraid of not working enough, without having the possibility of socializing.

By now it is evident how Covid-19 has affected our lives damaging the mental health of many people, regardless of their age, but, especially in the job market, the question still is: working that much will really lead to a better output? Mel Newton, head of financial services workforce consulting at KPMG, strongly believes in quality over quantity: he argues that it is nearly impossible to be active and productive for 15 hours straight and that taking a break from work would result in better performances. Statistics speak clearly: 64% of global business leaders affirmed flexible working had a positive impact on productivity.

Thus, big investment banks have started reconsidering their approach to tiring and long shifts, by introducing, for example, the “Saturday rule” (forcing junior bankers to take Saturday as a free-from-work day) or “Zoom-free” Fridays. The real question now becomes one: are these approaches really working? Different data show that companies are only promoting a do-goodery façade: taxi rides among 10 investment bank headquarters in New York City have significantly decreased on Saturdays while increasing late at night during the other days of the week.

For the moment it is an open question whether the situation will improve or not, but it is sure that investment banks have now the world’s eyes on them.

Author: Emma Gugliotta