Paul Myners has said, in response to this morning’s release
of the ParliamentaryCommission on Banking Standards, that “nothing much will happen at least
for 24 months”.
That seems to us to be a reasonable assessment of the
prospects for action by a Government besieged by banking lobbyists and
conflicted by its own desire to keep the economy going.
Yet, despite the industry’s efforts to keep all this change
at arm’s length, there is some evidence that the patient may be recognising the
need to heal itself, beginning perhaps at Barclays, in response to the Salz Review.
The key word, in our view, is “fiduciary”: the implicit duty
of the Board of a company to act in the interests of those who have entrusted
their monies to it. Shareholders, in the case of listed companies, and members
in the case of mutuals.
Sadly, the executives of mutuals have been no less generous
in rewarding themselves than those of listed enterprises.
“When I hear the word ‘culture’, I reach for my gun” has,
apparently, been wrongly attributed to Hermann Goering. But the truth in that
aphorism is that changing the culture of an organisation is not a task to be
undertaken lightly.
And we have advised more than a few clients to find a more effective
way of achieving behavioural change than just announcing a new set of corporate
values, supported by so-called town hall meetings involving all staff.
Above all else, what matters is what the guy at the top does.
And what the people then do. And what gets measured.
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