Bernard Ginns: Credit where it is due for socially aware investment bank

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THREE years ago, Rolling Stone magazine described Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money”.

The investment bank’s reputation took another mauling later in 2009 after its chief executive Lloyd Blankfein proclaimed that, as a banker, he was “doing God’s work”.

Goldman’s reputation sunk pretty low in the eyes of the public.

But there is another side to the world’s most powerful bank.

In 2010, it launched the 10,000 Small Businesses scheme, which was pioneered in Yorkshire and, credit where it is due, so far it has helped around 400 companies and social enterprises across the UK – 135 of them in Yorkshire.

I’m told the scheme took its inspiration from the earlier 10,000 Women programme launched by Goldman in 2008. Funded by the bank, the business programme provides a range of business education and support services to companies with growth potential.

Some of the Yorkshire companies that have taken part include the Ilkley Brewery, Exquisite Handmade Cakes, Prashad and The Proton Group.

According to Goldman, around 70 per cent of all participants have added net jobs; more than 60 per cent have increased turnover and 50 per cent have increased profitability.

Business Secretary Vince Cable met Goldman staff involved with the scheme and some of the participants at a round-table event in Leeds last week.

He was complimentary about the bank’s efforts with the programme.

A few weeks ago, Goldman became one of the first City firms to sign up for a campaign to help jobless Londoners into work and agreed to take 10 apprentices for one year. They will receive the living wage and on-the-job training.

Michael Sherwood, the UK co-chief executive, told the Evening Standard: “We have never done anything like this before, but it feels like the right thing for us, and for the City, to do.

“As a large firm with significant resources, we believe it is right that we step up and commit to taking apprentices.”

It is good to see this investment bank acting in a socially aware way.

Business in general has a duty to act responsibly, lest it tarnishes the rest of us.

Some of the biggest names in technology are finding themselves under pressure from UK politicians and commentators over their tax arrangements.

The latest giant to be spotlighted is Apple, which paid less than two per cent tax on its overseas profits, according to documents revealed at the weekend.

The company paid the equivalent of £445m in corporation tax outside the US last year, despite its foreign pre-tax earnings rising by more than 50 per cent to £23bn.

The headline corporation tax rate in the UK is 24 per cent; it is around 35 per cent in the US.

Apple is the latest multi-national to face criticism over its tax affairs. Starbucks reportedly paid just £8.6m in corporation tax in 14 years of trading in Britain – and nothing in the last three years.

According to the Sunday Times, America’s top-five technology companies, including Facebook, Amazon and eBay, legally avoided around £850m in corporation tax last year.

This kind of behaviour can do reputational damage, despite the fact that tax avoidance is not illegal.

Company directors can argue that they are acting in the best interests of their shareholders by minimising their tax bills to get the possible return for their investors, which often include the pension funds looking after our life savings.

But there is a limit and the public will only tolerate so much avoidance during a time of austerity, particularly when essential services are facing cuts.

There is a wonderful scene in Skyfall, the new James Bond movie, when 007 comes face to face with the villain, Silva.

Their exchange goes like this:

Bond: “Everybody needs a hobby”.

Silva: “So what’s yours?”

Bond: “Resurrection.”

As a word, Resurrection has so many connotations, but watching Daniel Craig tear around the world in a Land Rover and a Jaguar while dressed up to the nines in Savile Row suits made from the finest Yorkshire wool, he could easily be an advert for the revival of Great Britain as a great manufacturing nation.

Continuing the theme, M, played by Judi Dench, reads from Tennyson’s Ulysses: “We are not now that strength which in old days/Moved earth and heaven, that which we are, we are;/ One equal temper of heroic hearts,/ Made weak by time and fate, but strong in will/ To strive, to seek, to find, and not to yield.”

Stirring stuff indeed.