Julian Knight: Integrity isn't just the absence of corruption

I want to discuss the Kremlin – as the headquarters of Royal Bank of Scotland was nicknamed under the leadership of the disgraced banker Sir Fred "The Shred" Goodwin. As you can probably guess, it wasn't a jolly place.

A friend who got a job there went from being a relaxed, enthusiastic guy into a haunted figure in a few short months. A year later he resigned and described the culture as one where every perceived mistake was pounced on and people were afraid to tell it straight.

The culture at the Royal Bank was so dysfunctional that the bank lived a collective fantasy. Everything was rosy and anyone who disagreed with the line from upon high was either a traitor or spineless.

The Financial Services Authority has now released its report into the goings-on at RBS. It concluded that the bank made a series of bad decisions – paying a huge sum for ABN AMRO, for instance – but there was no lack of integrity. As a result, the FSA says it will not be taking enforcement action against Sir Fred and the other senior managers at the bank.

Yet how does the FSA judge integrity? If it means there was no fraud and dishonesty, I can well believe that. After all, many of the executives lived in a state of terror and who would be brave enough to try to rip off Fred The Shred? But integrity is a lot more than simply not being corrupt: as far as senior managers are concerned, it's about the culture created.

A bank's headquarters is never going to be a happy-clappy place but it shouldn't be the Kremlin either. The fact that RBS was just such a miserable place to work, one filled with rotten attitudes, is precisely the reason why it failed so spectacularly.

Fresh-thinking Fields

In Frank Field's latest incarnation as the Government's advisor on poverty the Labour MP is showing that he's far from being past his best: he's still a big brain on the major social challenges we face. In particular, his assertion that we shouldn't just focus on income as a measure of poverty is spot on. We may not have overt corruption in this country, but nepotism and cronyism is rife – who your parents are still counts a lot, rather than raw ability. Poverty can be measured in part by life chances and opportunity to scale the career ladder. A crude income measure of poverty dates from the start of the last century and Field is right to say we need to move beyond this.

New year clear-out

It maybe a bit early to start thinking about the new year but one thing I'm really looking forward to in 2011 is the Office of Fair Trading (OFT) finally bringing the loathsome debt-management firms to book. Already it has put more than 100 firms on notice that they risk losing their credit licences unless they treat customers more fairly.

Last week, the OFT refused an application from debt-management firm Baker Evans to call itself The Bankruptcy Helpline or The Insolvency Helpline. The OFT denial was based on the fact that the name implied that the firm's service was somehow impartial: it clearly isn't as debt-management firms want you to take out an Individual Voluntary Arrangement which earns them massive fees.

The case of Baker Evans is far from the most blatant: we have seen firms using phrases such as "free" in their names when patently they are not. Some have even put up websites closely resembling bona fide bodies such as the Consumer Credit Counselling Service or Citizens Advice. The tactics of the industry have often mirrored those behind the dodgy spam emails that daily drop into your inbox.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    SThree: Trainee Recruitment Consultant - Swiss Banking and Finance

    £20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...

    Ashdown Group: Marketing Executive - 6 month FTC - Central London

    £25000 - £30000 per annum + benefits: Ashdown Group: An exciting opportunity f...

    Ashdown Group: Junior Project Manager (website, web application) - Agile

    £215 per day: Ashdown Group: Junior Project Manager (website, web application ...

    Guru Careers: Software Engineer / Software Developer

    £40-50K: Guru Careers: We are seeking an experienced Software Engineer / Softw...

    Day In a Page

    Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

    Fishing is on Nigel Farage's mind

    Ukip leader casts a line to the disaffected
    Who is bombing whom in the Middle East? It's amazing they don't all hit each other

    Who is bombing whom in the Middle East?

    Robert Fisk untangles the countries and factions
    China's influence on fashion: At the top of the game both creatively and commercially

    China's influence on fashion

    At the top of the game both creatively and commercially
    Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

    The man known as GOD has a reputation for getting the job done

    Lord O'Donnell's three principles of rule
    Rainbow shades: It's all bright on the night

    Rainbow shades

    It's all bright on the night
    'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

    Bread from heaven

    Dutch survivors thank RAF for World War II drop that saved millions
    Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

    How 'the Axe' helped Labour

    UK will be 'run for the wealthy and powerful' if Tories retain power
    Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

    The price to be paid for challenging the rule of extremists

    A revolution now 'consuming its own children'
    Welcome to the world of Megagames

    Welcome to the world of Megagames

    300 players take part in Watch the Skies! board game in London
    'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

    Charlotte Gainsbourg on 'Nymphomaniac'

    Starring in one of the most explicit films ever
    Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

    Robert Fisk in Abu Dhabi

    The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
    Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

    Vince Cable exclusive interview

    Charging fees for employment tribunals was 'a very bad move'
    Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

    Iwan Rheon is returning to his Welsh roots

    Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
    Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

    It's time for my close-up

    Meet the man who films great whites for a living
    Increasing numbers of homeless people in America keep their mobile phones on the streets

    Homeless people keep mobile phones

    A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before