Not hostile to you at all, @blossom, just concerned that your historical experience doesn’t reflect today’s reality, and that as a result, some may be misunderstanding the process. I would hate for kids to miss the early recruitment for diversity, or stroll into an IB superday thinking they can discuss the WSJ, and expect to land a job. That worked 10 years ago. It doesn’t work in 2022, and I know of no one who has recently been through the process who thinks it does. Caveat emptor.
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Blossom- your whole post was very helpful and well written. Thanks for taking the time.
The above quote is what my spouse and I have seen working in finance/legal/HR in the tech industry. The idea that someone would advocate hiring someone because they are a lacrosse player or part of a club is laughable. Doing that would seriously impact your career.
What I do think is happening is some competitive clubs are gatekeepers to better ECs and resume building activities. For example a CS club could help a student develop a better portfolio of projects for an internship interview or a social club could lead to a better internship at a nonprofit for someone interested in public policy.
I haven’t followed every post on this thread carefully since it is hard for me to imagine my kids (or at least my oldest) being interested in the career paths mentioned. However, from an outsider’s point of view, the above sounds like the sort of circular reasoning that many institutions use to justify always maintaining the status quo in their practices.
It is important to be exclusive because that exclusivity is necessary for our members to succeed but it is OK that we are exclusive because excluded people don’t need to be part of our membership to succeed. Therefore we should continue our exclusive practices which are critically important for us but simultaneously not at all important for others. And plus we are concerns about other people’s bad breath, awkward personalities and poor personal hygiene.
Though I am sure that there is more to the arguments than the above, these statements. do give off a whole “separate but equal” vibe in 1) the insistence that separation matters a lot and yet does not matter at all and 2) in the tone used to describe those who are being excluded. And of course, unsurprisingly, the conclusion is that there is no need to re-examine or change current practices because they are clearly not just the traditional way but the only good way of doing things.
But mostly I am observing this conversation from a distance since I don’t have much of a personal interest (I have more of an Audre Lorde mindset around the subject, which is probably why I will never be rich).
My D22 daughter is currently not interested in the pre-professional clubs at her college though I suppose that might change or one of her younger siblings might upon reaching college. But she also agrees with the young woman in the video above and finds even non-professional extracurricular activities to be soured by the comp entry process.
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Anyone is allowed to interview through the regular channels. The " extra" channels get extra coaching, mentoring, opportunities, engagement with existing diverse employees-those who qualify are well-advised to take advantage of it. Most run some version of an early identification program, bringing diverse interns in as sophomores. Then can can remain or try a new place junior year
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Blame the internet. When resumes received equal 1 million, screening mechanisms take off. Or we could just prefer random hires.
You will receive a million resumes because the job and requirements are ambiguously defined to the outside public. This is like applying to Harvard in a TO environment. Everyone takes their shot. Some people never have a shot. They don’t know that. They want to try their luck.
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Yes. And online applications make that easy to do. Still means an employer is stuck with far too many resumes to review in too little time
I think basic fluency in finance involves a little more than that.
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I have seen kids with close to zero finance knowledge go into a 3 month internship at a finance company, and come out being very fluent in finance. So it is really a choice the banks have as to what kind of talent they want – kids that are easily trainable that have other skills, or kids that are pre-trained. I won’t presume to tell them what is in their best interests. They know better.
The discussion was Investment Banking and the increased and increasing preference for kids who have some fluency in Finance. So, yes, 3 mos. of exposure to concepts would help a lot for purposes of getting through an interview. That’s very different than your estimate of investing 1/2 a day on DCF and discovering what a stock is.
We all know a kid … I’m conveying information given to me directly from the banking world, with which I interact on an almost daily basis. The Geography kid from Harvard, without more, is not the lock to Goldman he / she once was.
Nor would I, and I don’t think I wrote anything to suggest otherwise.
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What I meant by this is that these days the analyst program is a 2 year program, and many kids go to the buyside. So the bank doesn’t have time to train and get some work out of the kids. Presumably, in the old days, people stayed at the bank longer on the IB side, and that allowed the bank to hire people that are more trainable than pre-trained. I worked on the broker dealer side of the business where kids were not hired into a 2 year program. They were there to stay a while longer.
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That’s not the impression I have gotten about the process. I will use the example of Deloitte, which although not as prestigious probably has a similar program to MBB.
For the summer after freshman and sophomore years, Deloitte has a “Discovery Intern” program. This program recruits underrepresented minorities. In addition to working on client projects, they also get professional development and mentoring.
The recruiting broadens after this point. The goal seems to be ensuring that historically marginalized groups have access to the same kinds of experiences that majority applicants typically do so that when they are interviewing for the post-junior year internships (the ones that usually lead to a full-time offer), they are on a level playing field.
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In my experience, the diverse students who get these early opportunities are already very polished. So it’s not so much about leveling the playing field. The programs are ways to lock up top diverse talent early. MBB is now recruiting diverse freshman for freshman summer internships at select schools almost as soon as they step on campus and paying only slightly lower than the junior internships.
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I don’t doubt that you are correct.
It’s similar to college admissions: colleges say they want more Pell grant recipients, more underrepresented minorities, but they tend to accept the “safest” students from those groups…the Pell grant recipients whose parents went to college; affluent underrepresented minorities, etc. They don’t necessarily recruit the most disadvantaged members of these groups.
I would hope that greater representation and diversity creates a better company and leads to a more more diversity in the future.
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It is not unusual for economics departments at colleges without business majors to offer finance courses.
Probably why economics is one of the most popular majors at Harvard, whose economics department offers several finance courses.
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Yes, hasn’t econ become the finance alternative at schools which lack an undergrad business school? It seems to dominate among the successful job applicants in all forms of banking
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Finance is derived from, or one could say a branch of, economics, so it would make sense to choose econ.
In my day, back when the glaciers were just starting their retreat, your average academic snob would pooh-pooh business school as a substitute for studying economics, with perhaps the begrudged exception for those who wanted to be accountants. Also back in my day, marketing and organizational studies were viewed as the lightweight business concentrations.
I guess when it comes down to it, somebody is always going to be looking down their nose at somebody.
If I were to advise someone majoring in business admin. at any school but the most elite, I’d push for accounting. No matter where you go to school, if you do reasonably well, you will have a job upon graduation at one of the Big 4 or the next level down. From there, you can pivot into many directions, even if you start out in assurance. I’ve also found that the accounting track kids can do anything the finance track kids can do as well or better; but the obverse is definitely not the case. Beyond the practicalities of it, accounting really does a good job of helping people understand early on in their careers how to evaluate a business and how well or poorly it’s doing. They don’t call it the language of business for nothing.
I would leave higher order financial theory for the MBA, the latter of which you’re going to need if you plan on being anybody at XYZ i bank. At least, that’s how it used to be. Perhaps that has changed as well. Btw, I’m not an accountant and it doesn’t look like I’m going to have raised one either.
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Curious what percentage of ib analysts/associates have an accounting background
Agree completely. I too do not have accountants but it is incredibly highly respected as a major and supremely useful.
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I’m guessing (only guessing) it’s low. Couple reasons for that guess: (1) with some big exceptions (Wharton, Haas, Ross, McCombs, etc.) most target schools don’t have undergraduate business schools, which is a pre-requisite for accounting; and (2) kids targeting i banks are probably looking for bigger money and bigger prestige. Accounting has a blue collar sense or feel to it when operating in the circles of people who want to be at MBB or Goldman, JPM, etc. It’s a huge disconnect. The biggest misconception is that accounting doesn’t involve finance, which is very much not the case in my view.
Consider this - if you land at a Big 4 and you’re on an assurance team, by the time you’re a senior manager (six to eight years 'ish), you can find yourself presenting to S&P 500 public company audit committees. I can say unequivocally in my experience only very senior people from the banks ever present to a public company board. You might get specialty teams, like, for example, pension liability strategy teams (taking on the role of outside CIO for a pension plan), with folks who aren’t tippy top, but that’s with management.
But when we’re talking about stuff with the board that requires someone from the bank, that guy, and anybody he invites, is very, very senior. Same with outside counsel. They NEVER bring an associate to a board meeting, no matter the firm. Senior partner only.
It’s two different things, so sure, it’s a bit apples and oranges. I’m just saying, by the time anybody lets you near their boardroom, you have been vetted and you have something very substantive to say.
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