Jim Armitage: He ruffled feathers but London owes Goldman’s Woody

Michael Sherwood left the top job at Goldman Sachs in the same fashion that he joined it: with a storm of publicity.

While he’ll be remembered for Goldman’s role in the BHS affair, some City veterans say his arrival at the helm in the noughties heralded a more aggressive approach in investment banking for the Square Mile.

Although that sharper edge raked in record profits for Goldman, in the rarified atmosphere of City boardrooms, it was deeply unwelcome.

During his early days as co-head of Europe, Goldman helped launch unsolicited takeover assaults on ITV, AB Ports, London & Continental Railways and Mitchells & Butlers. As a bank which also worked as an adviser to such giant companies, being a potential raider was simply not cricket.

The new approach reached its zenith at BAA, when a Goldman team was invited to advise on how the airports operator might defend itself against a bid from Ferrovial.

At first, the Goldmanites pitched their defence strategy, just as Rothschild, JPMorgan and others had before them. But then came a shock-and-awe approach: if you don’t fancy that, they said, we’ll buy you instead.

In the world of the City boardroom, for a bank to hint at making a bid when it’s been invited to pitch for an advisory job was outrageous. So much so that it resulted in the so-called Spank from Hank, when the bank’s boss in Wall Street, Hank Paulson ordered his UK arm to lay off.

Sherwood did not run Goldman’s mergers and acquisitions team at the time, but he was co-chief executive, and many still trace the newly aggressive approach to his elevation.

Woody has always been Marmite. His energy and brilliance as a trader, not to mention his wealth, make him a hero for fans of Wall Street-style capitalism in London.

For others, he is the epitome of all that’s wrong with a world where men who move money get paid millions while teachers and nurses struggle to get by. In truth, attacking him and his ilk is futile and silly. London owes its global clout, economic and cultural prowess to the revenues being made by financial superbrains like Sherwood. UK plc needs them too.

Perhaps the Goldman way was another assault on the pre-Big Bang gentlemanly way of doing business. Perhaps something has been lost by it. But, if Sherwood and his type had not been in London, all that money they have made, and all those taxes they paid would have gone elsewhere.

And, for all the criticisms, Goldman remains the bank most traders and bankers want to work for, and most chief executives want to hire. Much of that is down to Woody’s stewardship.

We should wish him well.