Sherwood vs the select committee: A match report
Apologies came more easily than smiles as Michael Sherwood, Goldman’s top UK banker, explained on Tuesday the firm’s relationship with Philip Green, and gave MPs the lowdown on how investment banking works.
You have to feel sorry for Sherwood, having to suffer the impertinence of a session before the UK's Business, Innovation and Skills Committee and the Work and Pensions Committee, who are peering into last year's sale of BHS by Green.
As one of the men running Goldman Sachs outside the US, Woody, as Sherwood is known, clearly has better things to do. He might, in fact, not have worse things to do.
He sat before his inquisitors with all the enthusiasm of a man chewing on a wasp and looking forward to the prospect of a scorpion for dessert. However, if the committee had feared that transparency might not be the order of the day, they need not have worried: Woody is as transparent as they come.
Within 20 minutes, the eye contact was getting less frequent, the hand rose to the forehead more often, the tie got pushed from one side to the other with more frustration, the index of his ring-binder was turned to a little more forcefully, the surface of the table was consulted more regularly and with greater interest each time.
For a mere mortal, peak exasperation would not be far away, but Woody is the very model of patience.
And it had all started so well, with the meeting's chairman demanding to know why a log of activity provided by Goldman Sachs, "which we thought was complete", turned out to have missed a request from Green for a £40 million loan to support the transaction.
Sherwood is not renowned as the most clubbable of men among colleagues, but he instantly hit it off with the committee’s chairman. Delighted by the opportunity to kick off proceedings by apologizing, Woody fixed him with an appreciative glare as he fessed up for missing the reference in the bank's systems.
Woody uses smiles like some people use knives. There's an initial surprise when one gets whipped out, followed by a sharp pain. Fortunately, he doesn't use them often and the committee were sensibly reluctant to encourage him. As was to be expected, the dialogue was at times scintillating, the questions probing. "You have a pensions group?" "We have a pensions group, yes."
If Woody was out to show that the Sunday Times’ depiction of him this weekend as Mini-Me to Green’s Doctor Evil was out of order, he wasn’t letting on.
However, he did get energised once, given the opportunity to set out the very principles of client coverage. It was a difficult point for the committee to grasp – why Goldman would bother giving advice now and again for years to someone who wasn't paying them. How much they needed to learn about investment banking!
Woody, on familiar territory, was positively chatty. Goldman was in the business of covering clients who might not do things for a long time, he explained. But they still stick with them because they want to be in the goalmouth when the ball comes in, they want to be close to any large transaction that might happen.
Woody, a Brit who speaks English with a Goldman accent, added that he had been tempted to say that the strategy was to "hang around the hoop", but preferred goalmouth in the end. "I was trying to be British." A smile there.
Woody's not above having regrets, though. Allowing himself perhaps his third smile of the day, he wished that the firm had better documented in writing just how small its role had been, so as to have avoided the subsequent confusion.
If the committee was tempted to feel frustrated that they were not getting answers, they only had themselves to blame for not asking the right questions. After all, it's not like Woody didn't want to help with information and opinions whenever he was able to.
"Am I high net worth?" asked one committee member. No, Woody assured him, you are not.