Why companies are telling staff to loosen their neckties

New York: For decades, Goldman Sachs’s bankers have flown across the world pitching prospective clients and drawing up multibillion-dollar deals in expensive suits, ties and pantsuits.

Those deal makers can now plan on dressing down — at least a little bit.

Goldman Sachs told its employees last week that it planned to relax its dress code. The change was signalled by the new chief executive of the US investment bank, David Solomon, a veteran banker who also DJs under the stage name D-Sol, and two other senior executives in a memo to staff.

They wrote: “We believe this is the right time to move to a firm-wide flexible dress code.” The memo cited the “changing nature of workplaces generally in favour of a more casual environment”.

Such a move was once considered unimaginable for the Wall Street firm’s leagues of monk-shoed partners and bankers in bespoke suits. Historically known as a white-shoe investment bank, Goldman Sachs traditionally required formal business attire. However, it cautioned in the new memo that staff should “exercise good judgement” and that casual dress would not be appropriate for every situation. Goldman had already loosened its dress code for its technology staff but had maintained formal business attire for the remainder of its 36,000 employees.

It’s the latest attempt by a Wall Street firm to cater to the younger workers whom the industry eagerly tries to recruit. A top competitor, JPMorgan Chase, took the leap into business casual nearly three years ago, making a more informal look the default dress code.

The new sartorial rules are also a concession to the Silicon Valley giants that Goldman and other banks have assiduously courted, companies where the norm is jeans and wool sneakers, not bespoke suits and Gucci loafers. Deal makers have been known to don hoodies to win business from the likes of Facebook and Google.

“Of course, casual dress is not appropriate every day and for every interaction … We want all of our clients to feel comfortable with and confident in our team, so please dress in a manner that is consistent with your clients’ expectations,” Goldman executives said in the memo.

The announcement was also meant to bring the bank’s traditional policies up to date for its younger workforce. More than 75 per cent of Goldman employees are members of the Millennial or Gen Z generations--people born after 1981. Solomon has himself drawn attention for his seemingly unbankerlike pursuits, and like his counterpart at JPMorgan, Jamie Dimon, has been known to go tieless for public occasions.

Earlier this week, Virgin Atlantic said its female cabin crew will no longer be required to wear make-up in the air. The airline will also provide female crew with trousers as part of their standard uniform, rather than only providing them on request.

But the efforts of Wall Street and corporates around the world to embrace casual dress have been met, unsurprisingly, with caution. Denim remains a relative rarity among bankers based beyond the West Coast, perhaps for fear of being seen by their bosses as slacking off.