Words .....that work

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Raising Voices on Ethics And Care In Business

Posted on January 15, 2013 at 4:25 PM

Some dissension in the ranks of the banking industry can only be a good thing, if anything is going to change. Otherwise they just exhibit a convenient amount of 'groupthink' of the sort we keep being told is bad for the boardroom, bad for leadership, bad for progress, bad for the growth of business and just generally unhealthy for society at large.

Anthony Browne, CEO of the British Banker's Association, appeared before a UK Parliamentary Commission on Banking Standards yesterday. He called for the creation of an independent Banking Standards Review Council to police the sector and told the Financial Times: “If the UK authorities support such a board, the chairmen of the main UK banks have pledged their support and co-operation to make sure it is effective.” 

I like the sound of Mr Browne. When asked by politicians on commission  about reports that Goldman Sachs was planning to delay making UK bonus payments to avoid a higher UK tax rate, he said: “It clearly doesn’t restore trust.”

Not only did he put the word "trust' where it belongs - under everyone's noses after financial scandals that run and run until we all run the risk of becoming so jaded we don't even expect anything better - but the BBA also called for the establishment of a code of conduct setting out ethical principles.

Ah, ethics - I still say it should be compulsory in schools. (Perhaps they could teach it as a compulsory module in the 'financial nous' curriculum the government is planning to be taught by the banks...)

At any rate, as the full FT story here explains, the BBA has suggested this 'code of conduct'  should apply to all bank employees. It has also suggested that a “blacklist” of employees could be developed to prevent those who fail to adhere to those standards from working in banking or financial services.

This does sound as if even the BBA has realised that the banking industry has gone too far down the sewer to do anything other than repent and be policed - and has decided it is best done (and seen to be done) by its own. 

I was about to about to put the link here to the story about how Goldman Sachs was planning to defer bonuses to protect its highly paid bankers from paying more tax....but - wait - it's a fast-moving world at the moment -

Goldman Sachs has now backed down from proposals to defer bonuses to allow its top bankers to avoid the highest rate of tax in the face of criticism by none other than Sir Mervyn King, governor of the Bank of England.


Speaking at the Treasury select committee - and as The Guardian points out, just as Goldman's compensation committee was meeting ahead of the bank's full-year results tomorrow (shortly after which bonuses will be announced), Sir Mervyn told MPs:



"I find it a bit depressing that people who earn so much seem to think that it's even more exciting to adjust the timing of it to get the benefit of the lower tax rate … knowing this must have an impact on the rest of society, when even now it is the rest of society that is suffering most from the consequences of the financial crisis."

He went on to say that it would be "rather clumsy" and "lacking in care". "In the long run, financial institutions do depend on goodwill from society," he said.  

Classic British understatement, but hugely magnified when it comes from the Governor of the Bank of England. 

So let's have some more dissension and strong views, however softly or loudly you care to speak - there's a rash of good words around at the moment like 'trust' and 'care' and 'ethics' and 'goodwill' - if we can harness those and embed them into our businesses they will be far more powerful than any regulation.


Categories: Governance, Communication, Scrutiny