One after the other as the morning wore on, Goldman Sachs GroupInc.'s most senior leaders—all men—took turns on stage describingtheir plan to restore its dimmed star.

Much of it rests on a woman who's being groomed to jointhem.

The strategy Goldman laid out at its investor day dependsheavily on the normally staid office of its treasurer, BethHammack, a longtime trader who's quietly charting her way up theranks. Her challenge: rework how the bank funds everything fromconsumer loans to billion-dollar derivatives deals. Senior leaderssee the mandate as proof she's bound for higher office at the151-year-old firm.

As Goldman struggles to make good on pledges to recruit morewomen into its most senior offices, Hammack is among a small numberwho make the cut in every behind-the-scenes conversation. Insiderssee her as a likely candidate to someday serve as CFO, lead thetrading division, or take a number of other top posts—jobs thatwould make her one of the bank's most prominent faces on WallStreet.

Yet in many ways Hammack is atypical at Goldman. She doesn'tproject the swagger of its high fliers and keeps her ties to anumber of illustrious industry figures under close wrap. Relativelyfew at the bank are aware, for instance, that her father helpedstart Renaissance Technologies, one of the world's most renownedmoney-making machines.

She may well be the type of leader that Goldman needs as it asksshareholders to believe in a less flashy strategy forre-establishing its industry dominance.

"She's brilliant, and she can explain the most complicatedthings in standard English," said Marty Chavez, the bank's formerCFO. "Once I thought of challenging her and asked if she couldexplain something in a Haiku," he said, recalling a conversationabout liquidity coverage ratios. By the next morning, her responsewas waiting in his inbox. "That's Beth."

Now, Goldman is placing her work squarely in the public glare.Last month the bank laid out a strategy for boosting revenue with amix of new business lines and technology—an initiative that soonhit its first bumps with a spate of executive departures. But justas important to the firm's new profitability goals are its plansfor improving the way it funds itself.

"That column sits squarely on the shoulders of Beth," currentCFO Stephen Scherr said. "Her sensibility about the markets isuncommon among individuals who sit in the seat of thetreasurer."

See also:

• Financial Services Industry Must Do Better onDiversity

Even in an industry where men dominate every major firm, thedearth of women atop Goldman is stark. None has ever served as itschair, CEO, president, COO, or CFO. Not a single division boasts afemale leader. Only two women have been so-called named executiveofficers—but none since 2005.

Hammack, 48, is among a small number of executives positioned tohelp correct the imbalance. Others include Stephanie Cohen, thechief strategy officer who became the youngest member of Goldman'selite management committee in 2018, and Carey Halio, the head ofGoldman's banking subsidiary. Hammack declined to comment.

Already, Hammack's climb at Goldman has taken her far outsidethe shadow of her father, Howard Morgan, a prominent venturecapitalist who previously helped Jim Simons start Renaissance.Simons was at her bat mitzvah, and the two now sit on the sameboard of a math advocacy group. Some of her colleagues learnedabout those ties only recently when the bank was huntingfor ways to win more business from the hedge fund.

"She's always wanted to make it on her own," Morgan said.

Raised just outside Philadelphia, Hammack is the middle of threesisters. The older chose a path into business, and the youngerbecame a private detective. Hammack would end up on Wall Streetafter an eventful stint at Stanford University.

She was part of a council of student presidents at Stanford thatincluded the guy who played the Wing Kid in 1980s classic "Gremlins"and John Overdeck, who went on to become the billionaire hedge fundmanager behind Two Sigma Investments.

Her classes included one on options with Myron Scholes. Hehelped develop the founding construct for pricing theinstruments—the Black-Scholes model—and went on to win a Nobelprize. He later co-founded the hedge fund Long-Term CapitalManagement.

Hammack spent two summer internships on the floor of thePhiladelphia Stock Exchange before accepting a campus offer fromGoldman Sachs in 1993. Early on, she parlayed her acceptance toHarvard Business School into a promotion. She's been rising eversince.

Women were establishing themselves in the trading division inthe 1990s as derivatives markets embarked on their rapid—andperilous—growth. Many of Hammack's female peers gravitated towardsales roles, which left her as something of an anomaly, said ChipCarver, who ran the derivatives desk at the time.

She was part of a small cluster of traders with a direct view ofWall Street's biggest earthquake—Orange County's municipal bonddefault, Gibson Greetings' botched bets on derivatives, legalblowups around Bankers Trust, and the implosion of Scholes' LTCM.Each had to be navigated carefully.

"I certainly had some traders where you became worried whenthere were some tough questions," Carver said. "With her, you cancount on ending up in the right place."

In the decade that followed, there would be fawning attention onGoldman's big risk takers—often top traders who went all-in andmade fortunes for the bank. Hammack was never seen in thatcategory.

Debating Promotion

She would go on to hold a variety of key roles dealing withagency bonds, rates, and repo (repurchase agreement) trading.Ultimately, her rise to prominence was driven by her ability todeal with regulators and government bodies after she made partnerin 2010. She's now chair of an influential Wall Street advisorygroup that has the ear of the U.S. Treasury secretary.

One snag was the inclusion of her name in high-profile civillitigation accusing big banks of colluding to rig the prices ofbonds issued by Fannie Mae and Freddie Mac. Plaintiffs named dozensof Wall Street executives—not as defendants but as "key personnel."Like others, the firm settled. Hammack's career has continuedapace.

Her elevation to treasurer in 2018 was controversial within thebank for a different reason: Top executives couldn't agree onwhether the trading unit could spare one of its rare senior women.It's another sign of the tensions CEO David Solomon will face as hetries to make good on promises for advancing women, both at his ownfirm and others.

Goldman's treasury is in the midst of a shift, too, reducing itsreliance on potentially fleeting or expensive funding markets andembracing a model increasingly based on customer deposits andmanaging corporate cash flows. That will be integral to boostingrevenue, thanks to an accounting quirk. Improving the mix offunding and cutting interest costs feeds straight into the bank'stop line.

For Hammack, the job may just be the start of infiltrating thetop tier of the male-dominated firm.

"Goldman is at least trying to solve for this difficultproblem," said Leslie Sillcox, one of the bank's named executiveofficers when it went public in 1999. "Twenty years later, I wouldhave expected a lot more women in senior roles across theindustry."

–With assistance from ShahienNasiripour.

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