Vogel Wakefield blog

Vogel Wakefield blog

July
05
2012

Dysfunctional banking cultures: what they need is servant leadership

How do you set right a corporate culture beset with “systematic dishonesty” – as Barclays has been described by its former chief executive, Martin Taylor?

The scandal at Barclays over its rigging of financial markets seems to represent a turning point which will require all banks to take a long, deep look at how the ways in which they operate may contradict the public interest. Were we not already in the worst financial crisis in living memory, the computer failure at RBS – which has prevented customers accessing their money and is still ongoing at Ulster Bank – would count as a monumental banking failure in its own right, evidence itself of the incompetence, negligence and greed that over many years has overwhelmed an ethos of stewardship at the major banks. On top of that, came news last week that the big four banks had committed serious failings in their mis-selling of interest rate hedges to small and medium-sized businesses

Small wonder that the Governor of the Bank of England has described the banks as “shoddy” and “deceitful”. Or that the Director-General of the Institute of Directors has said the banks “should feel deep shame for the damage they have done”.

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March
15
2012

A master of the universe resigns

Goldman Tower, Jersey City

Goldman Tower, Jersey City

Greg Smith had been working for Goldman Sachs for twelve years before he published the resignation letter yesterday which has caused a furore.

It presents a devastating portrait of a corporate culture that is entirely self-serving and betraying the interests of its clients:

“I attend derivatives sales meetings where not one single minute is spent asking questions about how we can help clients. It’s purely about how we can make the most possible money off of them. If you were an alien from Mars and sat in on one of these meetings, you would believe that a client’s success or progress was not part of the thought process at all.

“It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail.”

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November
29
2011

The season of social value

Occupy London protestors at St Paul's Cathedral.

Occupy London protestors at St Paul’s Cathedral.

 

The idea that business should create social value, not just shareholder value, is fast becoming the common sense of our time. One could interpret this as a delayed corrective to the crisis in capitalism brought about by the credit crunch. But there was no inevitability about it. Even at the start of the year, when Michael Porter published his Harvard Business Review article on creating shared value, his argument was greeted with scepticism as much as agreement.

Since then, we’ve had the Arab Spring, public disgust with the press brought about by the phone hacking scandal and now the Leveson hearings, riots in England over the summer, the Occupy protests, and the looming threat of financial and social collapse in the euro zone. These events have given voice to public unease with corporate elites who seem out of control and political elites who have no answers to our current predicament.

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October
01
2008

Thoughts on getting through turbulent times

Lehman Brothers staff, London, 16 September 2008

 

When I talk to people in the financial sector, I understand the meaning of the current turmoil being a crisis unprecedented in our lifetimes.  The experience of redundancy is  unlike that any of us are likely to have come across before.  With banking institutions disappearing at a rate of knots, others laying off staff in their thousands and many of the remainder uninterested in hiring, the impression of alternative options rapidly closing down throughout the world can only compound the sense of shock for those who have suddenly lost their jobs.

I’ve seen plenty of advice to bankers along the lines of: polish up your CV and interviewing skills, tap into your network and be prepared to move.  There may be a place for these tried and tested career tactics.  But I wonder whether it is adequate to the moment to rely wholly on this approach.  When people suffer a shocking loss, they typically go through experiences such as denial, anger and depression before they feel able to accept the situation and engage with it constructively.  The slightly frenetic character of well-intentioned advice on job search skills seems to me to risk encouraging people into activities which – for some of them, at least – may be counter-productive.

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