Is Reneging Actually That Bad?

The above is specific to on campus recruiting, where schools will not allow the firms to give exploding offers and set a date. It’s not that they are trying to take advantage of some candidates vs others (even if that’s how it ends up coming across).

As far as reneging, as a general rule it shouldn’t be done, but I think this site and many people overstate the repercussions. Yes, you will burn your bridges with that firm, but very unlikely they are going to set out to screw you across the street. Ultimately you need to do what’s in your best interest. There is a point where reneging an offer screws the firm (ie waiting until the last minute) but a bank having to hire an additional FT analyst in 6 months time isn’t the end of the world and is very little incremental work for them

MY BB give me 1 week last year to accept offer or be drop. For the record, I came from extreme non-target. I try recruiting for another team but, was almost an auto ding by HR because I have accepted an offer or if I don't bring up accepting the offer, they think I didn't get a return offer.

My career center clearly says that exploding offers, especially returns, are not allowed and at least 1 month has to be given. (Got offer through OCR). The firm is only giving me 1-2 weeks to decide. What would you all do in this situation? 

None of the BB/EBs pulled internships, return offers or cut pay.

If anything, they proved they would stand by their commitment this past cycle, even when it wasn’t convenient for them.

Reneging isn't as bad as it is made to seem. 

And most of the time, they don't even care. They might be annoyed by it but nobody will go out of their way to try and screw a 20 year old for going with another company. 

Personally seen an offer get pulled for an intern at my BB that reneged on an MM - no idea how HR found out.

Just another manifestation of the over-sensitive, pretentious nature of investment banking. The industry is infamous for being full of prideful, picky people who have overly high expectations. Same attitude applies to the recruiting process: you forget to send your resume in your introductory email? Lack of awareness. You forget the formula for levered free cash flow? Lack of preparation/ intellectual aptitude. You renege on their ever-so-gracious offer to work for them? Ungrateful, impolite and unacceptable.

At the end of the day, you have to do what's right for you just like they have to do what's right for them. Key is to do it in a respectful way that won't do too much damage to the reputation of you or your school.

At the end of the day, you gotta look out for #1. That sometimes means pissing people off. Who cares?

muh ethics

dude there are no 'ethics' in reneging, it's literally just about money. If firm B pays more than firm A then what's the big deal? Imagine a bank telling you it's unethical to renege on another offer for their firm when there are banks that have literally bought hunger bonds in third world countries and have faked clientele accounts and outright robbed them. I do NOT understand what would stop someone from reneging apart from the fact that some firms might blackball you; but if your concern is it 'being looked down upon' then who cares? Excuse my naivety, but if there's something else to consider please inform me.

It's power dynamics. They have the ability to harm you while for most (special sons and daughters excluded), you have no ability to do anything to that firm early on in your career. I'm not saying it's right, just explaining the why. I would just encourage you to maintain that clarity of thought as you progress in your career. The power dynamics eventually change as your career progresses and you become more influential. If I'm not clear enough, you are right. They do not give one rats ass about you and you should act accordingly. 

Renege for Lazard. I dare you

Then, what’s the point of employment at will??? So it is not a true at will offer

What happens if u get ur signing bonus and then renege?

Why are there so many threads on this? No one cares if you reneg or quit a few weeks into your job for something better, except maybe the 1 or 2 guys on your team who pushed for you. They will care, but no one else will. Man the egos on this board are crazy.

What about reneging for Summer Analyst programs? Is it risky considering I'm an international student too?

BO for FO or LMM for BB are completely fine. In fact, if you didn’t renege people would find it odd. Every LMM MD will understand why you would renege for a BB, and BO for FO is a no brainer. I reneged on a BO for an IB role and the recruiter completely understood. Even asked me to consider applying in the future.

If you renege from BB for BB because of “better culture” or “because one is more prestigious, higher in the league table” or whatever the 17 year olds say on WSO, that’s bad. Don’t do that.

Unpopular opinion: reneging is unethical because it involves you the individual lying. Firms don’t really lie and as an individual, you are held to a different standard than a firm because you have a personal reputation to hold the rest of your life. Also, on an individual basis, more is in your control. Generally, reneging implies you signed an offer, said you would accept, and despite that promise, you continued interviewing and accepted another offer because you liked it better (or it paid more). What’s generally not considered reneging is taking a different job due to a serious personal issue or an unusual circumstance that changes the circumstances you originally accepted the job in.
 

Firms fire people suddenly, they play games with candidates, and can be ruthless, but they don’t really outright lie. I understand some of you believe you are justified in reneging because firms don’t have ethics, you are entitled to your opinion and I don’t disagree. However, as an individual you are given a choice to hold yourself to a higher standard and the act of reneging signifies to everyone else you are someone who will betray ethics for a quick buck. Older people and people who pride themselves more on being ethical, will view reneging as an indication that you are a scumbag and they will avoid people who exhibit this behavior as you get older. Can you renege and get away with it? 100% Is it a career decision that often is indicative of the way a person will behave throughout the rest of their career? Also 100%. Do most people behave unethically in finance? 110%, but the good ones don’t do shit like this. 

Snakes will always be snakes and ethical people will always be ethical. Overtime the groups separate and behaving like a snake will get you excluded from opportunities with people who pride themselves on ethics which might be fine for you as an individual, but it’s something I would recommend avoiding. The snakes aren’t even aware that they are excluded, but trust me, they are. I have watched deals not get done because my team has called for references, realized we are potentially getting in bed with a snake, and we collectively decided it isn’t worth it.
 

Also, since I know I will get flak: not an A1 made this account several years ago. I would avoid reneging unless you find yourself in an office that is absolutely despicable and even then, just reject the offer and interview other places. No one is forced to renege, you put yourself in that situation to give yourself an advantage by neglecting what you know to be viewed as a generally unethically practice by many.

Reneged BB for buyside FT and know a lot of people who have reneged, my $0.02:

1. Reneging is riskiest within industries (IB —> IB) particularly banks that work together a lot on deals (MM —> BB/EB is therefore less risky than going to a competitor MM FT). IB —> PE is pretty safe: banks are not going to call up all of their clients and cry about them stealing an analyst.

2. Do not feel bad about reneging. It is literally written into these contracts that you are an “at will employee” and basically your employer can terminate you at any time for any reasons. You are also granted the explicit right to pull out at any time for any reason.

3. Do not tell anyone outside family that you reneged until the start of your last semester at the earliest, and ideally wait until graduation. You’ll be proud, it will be difficult, but better to be safe and sound.

4. When recruiting while signed elsewhere, make it crystal clear to the firm you are applying to that you already signed at the other place, but that XYZ is your first choice and you got pressured into signing immediately or something like that. THIS IS IMPORTANT because even if you are caught, your new firm won’t care, and if a firm does care you probably shouldn’t renege for them anyways.

5. This is the hottest job market for high-skilled workers ever. You’re not acting in your best self-interest if you’re passing up on applying to higher paying opportunities that open more doors for you.

6. It’s economics: If a firm didn’t want you to renege, they should have paid more or offered you a better summer experience.