Goldman CEO Apologizes for Remarks

Goldman Sachs Group Inc. Chief Executive Henry Paulson apologized to the investment banking firm’s employees, telling them in a voicemail that he had made a “most unfortunate remark” last week when he forecast additional job cuts.

“Since I view my job as being a steward for the firm and its culture, I am profoundly embarrassed and particularly unhappy about my choice of words last Tuesday,” Paulson said in the voicemail, which was waiting for employees when they came to work Monday.

At a conference in Manhattan last week, Paulson said: “I don’t want to sound heartless, but in almost every one of our businesses, there are 15% to 20% of the people that really add 80% of the value. Although we have a lot of good people, you can cut a fair amount and still be well-positioned for the upturn.”

Goldman fired more than 2,900 employees in 2002 as earnings declined 8% and revenue slid 12%. The firm now has about 19,740 employees.

Paulson said his initial reaction was to meet personally with employees in a series of town-hall meetings, but “it became clear to me that I should get to every one of you immediately to apologize.”

Paulson said that if Goldman had to cut further, “we can do so without fundamentally weakening” the firm. He added, “Our franchise is so solid that none of us -- and that certainly applies to me -- is indispensable.”

Goldman shares fell $1.73 to $67.52 on the New York Stock Exchange.