James Gorman - Chairman Emeritus of Morgan Stanley | Investment Conference 2026

I'm retired. That's why.

This could be dangerous, but anyway.

Yeah.

Yeah. It's very hard to talk about culture if the business isn't working, you know.

You can go. I mean, how this came up, the board of directors came to me when Barclays Bank had a new chairman, new CEO, and they did a global tour which was a culture tour. And they said to me, kind of, why aren't you doing that? I said, because firstly, we're still figuring out what we're going to be when we grow up. I don't know what Barclays is going to be when they grow up. What do you do if you go around the world, you tell people, 'This is our culture. This is what it means. These are our core values.' A week later, you come back and say, 'Unfortunately, you're fired.' But it's still a great culture. So, you've got to have a strategy which is viable, which gives people an opportunity and promise for the future, and then build the cultural values around it. And those values are what let you change your strategy over time because it gives you the confidence it's coming from the right place. So strong companies, I think of it as it's like different cabins on a train. You've got the strategy, then the culture, then the strategy, then the culture, then the strategy, and that's how companies stay around for decades, centuries, is they're prepared to reinvent. They reinvent with the strong bones that come from confidence in their culture.

Well, that's something I think I agree with, with was it Michael today? Although I'd have to say, I just want to say, and I'm not saying this to pander to you, I flew in on SAS this morning. It was a fabulous flight. The food was great. The people were nice. They didn't charge me for my bags. Everything. It arrived 50 minutes early. 50. I was the first person through customs. I loved it. So, I'm sure Ryanair is good. I just haven't been on it.

Yeah, toilets are free. It was good. You know, I think if again, people will support a non-winning culture, but you'll get a certain type of people who support that. If you want real goers, people who are prepared to put themselves, you know, on the line of fire, run to where the drama is, then they need to know that they're part of a winning organization. Charisma works great once you tell people to, you know, charge up the hill and they get all shot out and they say, 'Well, that's not a really good idea.' You say, 'It didn't work so well, but charge again.' And they say, 'Have you got another way of getting there?' You know, it's like, so people need to be part of something. And if it's winning, it's infectious. And if it's infectious, they truly do exceptional things. So yeah, your job as a leader is to figure out a winning strategy that puts everybody in a position where they can thrive.

Well, I say it in the nicest possible way. You know, at the end of the day, you've got to decide. This was another thing I had a discussion with the board. I said if I have a dream which is to get a really smart neuroscientist and really smart software developer and a computer scientist and put them in a room together and say come up with a camera and the camera has to take a picture of the inside of people's heads. So when they go to work in the morning, they stand in front of the gates, you know, the floppy gates, whatever they are. You don't pull out your card to get in. The gate opens if it takes a picture of your head and you've passed the test. And the test is half of you has to be coming in for yourself because to deal with adversity, to drive forward, you've got to have ego, confidence, whatever. But half of you has to be coming in for the institution. So the rallying cry to the bankers or the traders or anybody was, you know, it only works if we all make it work. And if it's just about you getting your piece, 98% is you. If everybody does that, that's a war of attrition that won't end well. And by the way, you're paid in the stock and the stock is going to go up if it goes well. So why wouldn't you want this all to work? And that means putting a little bit of yourself aside to do what's right in the institution. And happily, our investment bankers did. They were fantastic about it. But blunt language and expressing it as, you know, I don't come in for James Gorman Securities. I came in for Morgan Stanley and I respected its history. I respected the people who'd led it before me and I respect the people after it. Your job is to take the ship from one port to another, not to take over the ship only for yourself.

Sort of thing my dad would say to me. You know, it's like, it's the truth.

Yeah. I felt very strongly as COVID was going on and I was criticized by a lot of people for what I said and partly was I'd had COVID very early and got through it. So their attitude was it's easy for you to say. What I said was, I don't know if it's on your list, if you can go to a restaurant, you can go to the office.

And what happened was I was at a restaurant in New York picking up my food. I've been to the gym. I was picking up my food. It's a little Japanese restaurant called Bond Street. And a big dude walks up to me, puts his arm around me. He says, 'Great to see you.' I said, 'Who are you?' He said, 'I work in the organization, blah blah blah.' And he said, 'It's fantastic and crowded restaurant.' And he said, 'Can we get a selfie with this table?' We all do a selfie together. Everybody's high-fiving each other. And I said, 'Hey, finding being back at the office?' 'Oh, I couldn't go in the office. Not safe.' Like, what? What about all the kids? He's the senior management director. What about the young kids who are coming back to an apartment with three other kids in them? There's no privacy. There's a dog barking. You know, the neighbors are yelling and they're supposed to be doing work and they want to go in the office and their bosses aren't there. I said, 'It doesn't work that way.' We got the opportunity. We were mentored. We were developed because other senior people were around. Even as simple as would you, when I was a young lawyer, one of the senior partners one day said, 'Would you walk with me?' It was like four blocks to the court for a trial he had. I wasn't involved in the trial, but he was smart enough to realize that just being together for four blocks would change my day, change my month, I think. And I got to talk to him and no, you've got an obligation if you've come through that mentoring to give back. I feel that very strongly.

Well, we, I don't know that we, we certainly we gave sign-on bonuses to a couple of people at Morgan Stanley. We did none of that at Disney. So, there's not like one model. I mean this could be a very long conversation but the cliff notes are transparency. Yes, we're having a process. These people of the succession committee, the board will decide. There will be a start date. There will be a transition date and there will be a finish date. And after the finish date, the old CEO will be gone. They won't be like hanging around the hoop. They're gone. The new CEO will be put in place and they'll either have a non-executive chairman or an executive chairman for periods of time. So transparency of process, total respect, tell people the great news is you've been considered. If you're really ticked off about the toing and froing, there's an option here. Take yourself out of consideration. Nobody did that, right? So you're considered. I want to give you absolute respect, but our job is to find the best candidate for this company for the next 10 years. And that means we're going to be rigorous. We're going to ask you questions. We're going to make you, I had the Morgan Stanley people write strategy papers. I only gave them two weeks. I said, 'Come to my office. Send it to me in advance. I'll read it. I don't want any paper. I'm just going to ask you questions.' So that way if somebody wrote it for you, it's not going to be good, right? It's got to be real. It's what you think. We did health checks. We did all sorts of stuff. So clarity around the process, honesty, transparency. When the king has to be dead for the new king to succeed. So the king has to leave. And that's, and I left. I said to the board, they said stay, you know, you could stay a little longer. I said we can, but is it the right thing for the company, for the institution? You need somebody to do it 10 years. The fact I can eke out another couple doesn't work. So all of those are the elements but it really starts with clarity, transparency, and intentionality. There will be a result. You know Disney had messed up succession. It had had problems I should say for some years going back many decades. And we were absolutely convicted as a board it was going to be clean and Bob Iger to his credit did a great job through the transition. We have a terrific new CEO Josh D'Amaro.

What's that?

No, it's the board's choice. No, that's...

Yes. Very. The job of a CEO is to present viable candidates fit for purpose. The job of the board with the succession committee doing a lot of the leg work is to ensure inside and outside the company you've considered all options. And then properly test and arrive at a decision and it requires a board vote. We looked at, I mean I had so many people giving me names of people they thought could run Disney. It was a joke. I said do you even know who the internal people are? No, I don't know them. But my guy is the right person, right? So I said fine, I'll look at anything. I went on looked at podcasts. I looked at TV interviews they did. I looked at speeches. I did reference checking on a whole bunch of outside people. We decided the best person was inside and they beat all comers and that's the right answer.

We kept three internal candidates at Disney and we kept the two other alternatives at Morgan Stanley. All of them were kept and everybody said it wouldn't happen. I said we'll see. Treat people with respect. It makes a real difference.

Yeah, I called, I didn't do it in the early years, been late years. I called every Fortune 500 CEO within a month or so of getting their job and many of the international CEOs, really European more than Asian to be honest. It was just say congratulations. I'm not here to sell you anything. I just want to introduce myself. If you ever got issues you want to talk about, and they immediately start talking about their chairman won't leave, they've got an activist, a dysfunctional member on the board, their kids are unhappy about them doing the job, they're going through a divorce. I mean, suddenly it was like, whoa, I didn't mean that. I was just saying hi. And you get into a long therapy discussion. There was only one guy who turned me down, a French guy. I forget who he was. And he said, 'I don't talk to bankers.' I said, 'Well, that's good because I'm not a banker, but anyway, there you go.'

Yeah. Yeah.

What am I going to do about what?

Yeah. I have 12 seconds. The role of directors on any issue of consequence is to advise not to do. And the reason for that is the people who make the decisions live with the consequences.

I'm not going to share my advice. That's obviously between the board and the CEO, but these kinds of issues happen from time to time in large companies and it's the job of the CEO with their team to figure out the right answer and they'll be guided, you know, by the board but it's like anything if you throw 10, 15 people together they might have different views but I'm highly, we have a terrific new CEO Josh, he's world class so I'm sure he'll rise to the occasion and do what the right thing is.