Their own worst enemy?29th June 2012
“Banking was conceived in iniquity and born in sin”. Sir Josiah Stamp, President of the Bank of England in the 1920s, was a blue moon rarity – a banker prepared to question the probity of his profession. The default setting for bankers these days – unless they’re dragged before a parliamentary committee – is either to be ‘unavailable for comment’ or, if the press is battering the door down, to issue a disingenuous “justification”.
Of course, antagonism towards bankers is age old and the recent banking meltdown has merely confirmed the truism – that profit is private and individual, while loss is public and social. In short, it is difficult to respect ‘bomb proof’ executives who enrich themselves, often recklessly, at our expense. But while bankers know that they’re never going to be loved, they could make a better fist of being better understood.
Banking has been ‘in crisis’ since 2008; Barclays’ current embarrassment is just the latest manifestation of this long-term malaise. Effective ‘crisis management’ demands, where appropriate, a level of mea culpa. Admitting failure and, crucially, acknowledging responsibility for failure, doesn’t have to be a sackcloth and ashes exercise. In short, fronting up shouldn’t be equated with humiliation. We can all remember crises in recent years where the ‘healing process’ has started with a promise, from a visible CEO or Chairman, to do better . But what have UK banks’ senior executives done up till now? They’ve cowered behind Dame Angela Knight, Chief Executive of the British Bankers Association (BBA): none of them has had the bottle to volunteer for a mauling from Paxman, Peston, Humphrys et al. Dame Angela, who is relinquishing her role this summer, is, I am sure, an honourable individual, but her public utterances on the crisis have appeared, at least to this writer, to be little more than formulaic “we’re not to blame” bleats. Rather than fighting the fire, she’s helped to stoke it.
Dame Angela’s departure presents the BBA with an opportunity for a fresh start; a chance to clean the Augean Stable currently doubling as its external communications department. If it doesn’t do this, then it deserves to be held in the same contempt as other discredited trade bodies – the Federation of Master Builders springs to mind – which, while claiming to be guardians of standards are, in reality, little more than protectors of incompetents and cowboys.