(InvestmentNews' third-party video-hosting service has blocked the video accompanying this story per a request from Morgan Stanley. We are working to have it restored as soon as possible.)
There's a grain of truth in every joke, and while a video Morgan Stanley produced last year as entertainment for a branch managers' meeting was an obvious parody of the “Hunger Game” film series, it provides a unique, behind-the-scenes look at the country's largest wealth management firm.
The 10-minute video, titled “Margin Games: Manager on Fire,” was ultimately shelved and never shown at the branch managers' meeting in February 2014. But the video, a copy of which was obtained by InvestmentNews, seems to reflect a cutthroat culture among wirehouse managers and a lack of congeniality between leaders in the field and executives in the home office.
(The video is being presented here in its entirety because it is a parody and individual scenes may not make sense without the full context and plot.)
Starring a number of the firm's top brass, including Shelley O'Connor, who oversees the firm's approximately 16,000 advisers, the film has executives in a war room at headquarters, pitting branch managers against each other in a death match resembling the one portrayed in the “Hunger Games” series.
There are moments where managers joke about the coldness of senior leadership: “They'll have somebody at your desk on Monday,” one manager says to a competitor.
Other scenes feature jokes that hinge on racial stereotypes, including having an Asian woman appear as the expert in martial arts who pulls knitting needles from her hair and throws them at a dart board.
The company won't talk about the video or say why it decided not to show it. A spokeswoman for the firm would say only that the video was never released.
But according to sources familiar with the video who did not want to be identified, Greg Fleming, the president of Morgan Stanley Wealth Management, was involved in the decision. Sources cited different possible reasons for pulling the video, including concerns of human resources personnel about some of the jokes or scenes of violence in the workplace.
Some current and former Morgan Stanley executives who asked not to be identified said the fact that a video was even made that joked about people who were losing their jobs shows the detachment of executives from other employees. In fact, two months after the managers' meeting, the firm began a reorganization. The firm cut the number of regions to eight from 12 and reduced the divisions from three to two. One of the divisional directors who was featured in the video, for example, left the firm after his position was eliminated. Four regional managers were moved to different roles.
Last August, a number of other managers departed amid another reorganization of the consulting unit, which oversees Morgan Stanley's fee-based business. Many were well-known and had come to the firm through Smith Barney.
Those kinds of shake-ups have become commonplace at many wirehouses, and Morgan Stanley in particular, according to industry recruiter Danny Sarch of Leitner Sarch Consultants. Branch managers have found themselves the target of cost-cutting and consolidation efforts following the 2009 Morgan Stanley Smith Barney joint venture, he said.
For example, the firm has reduced its branch footprint by almost half from around 960 branches at the time of the Smith Barney merger in 2009 to 622 by the end of last year.
“They're a financial services company. They don't have factories, so what are their costs? Their costs are people,” said Mr. Sarch. “And [Morgan Stanley executives] don't believe that compliance decisions and personnel decisions should be made locally. They feel they should be made higher up.”
Mr. Sarch did, however, say that past videos produced by Morgan Stanley for the managers' meeting have helped to alleviate tensions at the firm and showed executives' ability to make fun of themselves.
Although he had not seen the video, he said that he gives Morgan Stanley credit for having a sense of humor.
“There's a fine line for them to walk and I give them credit for trying,” he said. “From their point of view, people are going to get laid off, so make fun of yourself. I give them credit for that.”