Morning Coffee: The best banking job of 2022 has become horribly tedious. BoA banker’s wayward son wrote everyone’s favourite financial film

It’s hard to remember now, but as the world was just coming out of the pandemic, we were all feeling idealistic and believed that a better, greener and more co-operative society was coming.  In the banking recruitment market, this manifested as roaring demand for “ESG” (Environmental, Social, Governance) professionals. As we said at the time, anyone who drove past a wind farm on the way to a meeting thought they were a potential green banker.

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Well, times have changed.  Many such post-pandemic expectations (from five day remote working to more respectful treatment of juniors) have turned out not to be a thing after all.  ESG recruiters like Tom Strelczak of Madison Hunt say that banks now have “buyers’ remorse” over the extent to which they staffed up with idealistic ESG teams in anticipation of a sea-change in the culture of finance which never quite arrived.

Obviously, the fact that “DEI” is now a political hot potato in the USA has not helped at all.  But even before the Presidential elections, things were becoming more difficult.  ESG was partly a low interest-rate phenomenon and in an environment where short term cash flow is a bit more vital, the disappointing performance of some green initiatives has soured a lot of investors on the whole space.  Some of personnel involved appear to be more concerned about their “social and environmental aspirations” than generating profits, but as another recruiter puts it, “Where we are right now is: Can you deliver returns at or above the level of traditional investments”. 

If the answer to that question isn’t a clear yes, ESG maybe become more career burden than career bonus. Already, Chief Sustainability Officers at several big banks have seen their positions downgraded in importance or even abolished.  Fewer than 7% of people who took on an ESG role in 2020 still have it in their titles.

There are, of course, exceptions, which is why there are still multiple specialist recruiters around to be quoted about how the market isn’t what it used to be.  Although fashions have changed, the regulations and reporting requirements brought in during the good old days of ESG are still there, and still need specialist staff to ensure that they are being complied with.

This unfortunately means that the people who wanted to change the world, are now stuck in roles ensuring that (mostly) tedious European forms are being filled in.  All the while waiting for their job to fall victim to the latest “regulatory simplification” exercise.  It seems like a rather sad way for the dream to end.

Elsewhere, bankers’ favourite films always used to be tales of lost innocence in the equity market – the most realistic thing about “Boiler Room” was that all the characters were word-perfect in delivering every line in “Wall Street”.  But once more, time has moved on and the world has got more cynical – according to Semafor, neither of those makes the top three for Millennial bankers and nor does “The Wolf of Wall Street”.

Instead, people whose banking careers got going after the financial crisis love to rewatch a tale of gross cynicism and fixed income trading.  “Margin Call”.  Like the other three classics, it not only expresses timeless moral and emotional truths about what it’s like to work under intolerable pressure in a competitive environment, it also gets the details of banking culture and terminology exactly right.

And the reason for that is that the writer and director, Jeffrey Chandor, was brought up in the industry.  His father was a Merrill Lynch executive who was “kind of forced to retire” after some internal politics, and although he had poor grades and suffered from ADHD and dyslexia, Chandor “certainly could have gone to work in that field”, probably on the sales side.  He also had friends who snuck him on to the trading floor at Citi to watch a round of mass layoffs.  Today, he claims that you can more or less forecast the market by looking at his streaming residuals to get an idea of how many bankers are dealing with things in front of them by reminding themselves they don’t have it as bad as the Kevin Spacey character.

Meanwhile …

Is there a bit of tit-for-tat going on between the big multistrategy firms, or does it just reflect that there are a lot of fishing lines in the same fairly small talent pool? The latest big name hire is Steven Schurr, formerly Balayasny’s senior managing director of fundamental equities, who will go Millennium after a year’s gardening leave.  That might be an attractive idea on its own given the state of markets, but he’s also allegedly getting a performance related package which could be worth $100m. (Bloomberg)

“I actually have a close friend who had to move desks probably five times over the span of an hour”, said one engineer at JPMorgan’s Columbus campus, where the new policy of five-day working has now come into contact with the reality of parking, traffic flow and desk space.  What’s it going to be like when the same issues are faced by more assertive front-office personalities? (Business Insider)

Although he’s a “lone wolf maverick”, John Pike of Elliott Investors is apparently “calm and deliberate” and when he “wages war” against oil companies he keeps a low profile. Activist investing just isn’t as exciting as it used to be. (FT)

Tidjane Thiam, the former Credit Suisse CEO, has given up his French dual citizenship but still has a few legal obstacles to his campaign to run as President of Cote d’Ivoire. (Bloomberg)

Promotion at the European Central Bank apparently depends on “knowing the right people”, in the view of a staff survey.  The ECB denies this and claims that some of those surveyed were contractors who don’t understand their ways. (FT)

“I’m looking for a man in finance” was the viral hit of last summer.  It turns out that there’s some truth to it; one reason for the falling marriage rate is that American women, while getting university degrees at a higher rate than men, don’t want to be the only graduate in their household.  (Atlantic)

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