Morgan Stanley CEO James Gorman (Photo: Al Drago/Bloomberg)

Like other industry leaders, Morgan Stanley CEO James Gorman says the bank’s operations probably won’t be “back to normal” this year.

“It has been an extraordinary few months,”  Gorman said at the firm’s virtual shareholder meeting Thursday, referring to the COVID-19 pandemic and its fallout. (Gorman himself recovered from the coronavirus last month.)

In the short term, “the direction of asset prices, zero interest rates and activity levels will impact our results,” he explained. ”This [market] environment is anything but normal.”

Some 90% of Morgan Stanley roughly 80,000 global employees are working from home.

Back-to-Work Plans

When asked by a shareholder about the bank’s outlook for staff returning to the workplace, Gorman said, “I would not expect at all for 100% of our employees to be back in the office this year. In fact, I expect a much lower percentage of that, probably closer to 50% by the end of this year.”

As of today, this figure varies across the firm’s global locations.

Roughly 45% of workers in Hong Kong are back in the office, Gorman said, while the number in New York City is “very, very, very small.”

“We’re working on a series of programs to provide a safe environment for our employees to come back,” Gorman said.

“Under no circumstance will the employees be forced to come back in 2020 to their desk when they have any concern or fear over their health and safety,” he explained, “which remains our most important priority.”

Diversity Push

“As we head into this new decade, we are committed to investing in our culture and attracting the most talent and diversity to our firm, so that our workforce reflects the diversity makeup of the society in which we operate,” Gorman said in his introductory remarks at the meeting.

One in five, or 20%, of the members of its operating management committees are women, “a percentage we are committed to improving over the coming years,” he added.

Earlier this week, Morgan Stanley said it is launching a wealth management unit in Canada that includes full-service and virtual financial advisors and that builds on the firm’s Shareworks stock-plan administrative services.

It will be led by Laura Adams, who also is head of Institutional Distribution in Canada.

Possible Pay Cuts, China

In response to a question on possible pay cuts for upper management, the bank CEO said such action will be considered at the end of the year, which is its standard procedure.

“The board will take compensation into consideration with the broader performance of the firm and the overall economic environment,” he added.

Turning to its operations in China, Gorman said “a relatively small amount” of its overall business is tied to that country, which is currently experiencing a number of tensions in its economic and other relations with the U.S.

“China is an $11 trillion economy, and the U.S. is about $18 trillion,” he explained, adding that “China is very important to the globe.”

The bank recently received approval to take a majority stake, 51%, in its China securities joint venture, Morgan Stanley Huaxin Securities. That venture was formed in 2011, while Morgan Stanley has worked in China since 1994.

“It remains an important part of Morgan Stanley’s future,” Gorman said about China. “But it’s a relatively small part of what we do globally. At least two-thirds of our business is U.S. focused, and the rest is spread around all other parts of the world, one of which is China.”