Goldman Sachs Group Inc., seeking to curb bias in its selection of junior employees, plans to discontinue on-campus interviews for undergraduates.
The move is a part of an overhaul at the New York-based bank that will standardize the recruiting process and seek to eliminate the likelihood that an interviewer chooses a candidate based on traits they share, such as college athletics or extracurricular activities, executives of the firm said Thursday.
“We’ve created a process to create consistent rigor,” Edith Cooper, global head of human capital management, said in a briefing at the bank’s headquarters. “We’re trying to take out an individual’s assessment of talent.”
Goldman’s plan threatens to upend Wall Street’s hiring practice, which for decades has meant on-campus interviews that can quickly turn to areas of common interests or mutual friends. The firm hopes to attract a broader swath of candidates and more efficiently select those who are the best fit by standardizing and automating more of the process, Cooper said.
Goldman Sachs typically selects about 2,500 undergraduates for internships each summer, and chooses among those to hire the next year’s crop of incoming analysts.
Beginning with next year’s class, on campus interviews will be restricted to MBA students as the firm tries to become “school agnostic," according to Russell Horwitz, co-chief operating officer of the Goldman Sachs’s securities division. The bank will then record interviews that will then be watched by a recruiting executive and scored on certain traits or characteristics.
The firm also will use a technology-based resume screening tool to try and identify traits such as grit, or life circumstances, that executives believe will better predict career success and longevity.
The shift means reaching more candidates with the same number of recruitment staff, Cooper said. The firm has embarked on its biggest cost-cutting push in years as it tries to weather a slump in trading and deal making, people with knowledge of the effort said earlier this year.
As a result of the changes, Goldman Sachs expects to draw applicants from beyond the 400 or so schools that typically produce candidates, including about 225 in the U.S., according to Mike Desmarais, global head of recruiting. The firm will continue to keep an annually updated list of dozens of target schools, he said.
Goldman Sachs’s senior ranks include several executives who don’t have a typical Ivy League pedigree. Chief Financial Officer Harvey Schwartz went to Rutgers University in New Jersey, while President Gary Cohn attended American University in Washington.
The firm is also experimenting with a personality test, and will continue to search for ways to reach potential candidates through social media. A recent Snapchat campaign was successful, Desmarais said.
While the new process reduces human bias, it doesn’t eliminate it. Interviews will still be watched and evaluated by humans who may allow subjective measures to influence their decisions, and the second round, when candidates visit one of the bank’s offices, will still be heavily concentrated on human-to-human interaction, the firm said.
The review that led to the first wide scale re-imagining of the recruiting process in more than a decade began early last summer, Horwitz said.
Lateral hiring, in which the firm hires people from other firms after they’ve worked in the industry, is so far exempt from this change, though the firm said it’s considering ways to standardize the entire hiring process.