The heady days of 1997 when Tony Blair swept to power telling us that things could only get better marked the beginning of a brief flirtation between business, the City of London and the Government.
But nearly 12 years on, the business world has fallen out of love with Labour. Talk in the bars and pubs of the Square Mile, surprisingly busy in the post-Christmas gloom, continues to be about "Gordon's clunking fist". Government efforts to spark the ailing economy into life are almost universally derided. What's left in the City's political donations pot is going to the Tories, with the former Man Group hedge fund boss, Stanley Fink, and ICAP founder Michael Spencer both giving generously.
So last week's news that one of the City's own, Mervyn Davies, former chief executive of Standard Chartered, had thrown his lot in with the Government as trade minister and a Labour peer was greeted with some surprise. Davies is a man generally agreed to be one of only a handful of banking executives in Britain to have emerged from the crunch with any credit, and those who have worked with him say the extent of his political aspirations was suspected but largely kept under wraps.
One former colleague says: "He has enjoyed being on government boards and panels – that was evident for a long while. The lure of a peerage was clearly too great to pass up. But he never espoused political leanings either way. It certainly wasn't obvious."
A 15-year veteran of Standard Chartered, a London-listed bank that makes most of its money in the emerging markets of Asia, Davies has amassed a personal fortune thought to be well in excess of £10m – he was paid £1.3m last year alone. It is probably just as well because he isn't paid a penny in his new role in the Department for Business, Enterprise and Regulatory Reform.
Davies has a decent personal reputation among colleagues and business peers. He is described in various quarters as "lively to the point of hyperactive" and "very aggressive at times but with a good sense of self-deprecating humour". "I'm not sure he'll be laughing so much when he becomes a lord, though," says one senior banker, who declined to be named. "Climbing the greasy pole in the City is one thing but politics is totally different."
Davies's primary ministerial responsibility will be trade promotion, but he is likely to play a key role in bank policy formulation, having been the leading City architect behind the drawing up of last year's £37bn bank bailout.
He follows a long line of people out of the City into Whitehall, not all of them successful. He takes over the reins from Lord Digby Jones (pictured), who spent 15 unhappy months in the job. The appointment of Lord Jones – "Digger" to his mates – had been seen as a huge coup for Gordon Brown. A former director general of the CBI, he assumed the role of trade ambassador in the summer of 2007. But his refusal to take the Labour whip was the start of an uneasy relationship. Six months later a row erupted over his failure to disclose, and place in an arm's length "blind trust", a holding in a cleaning firm likely to benefit from hospital deep-cleaning plans. The delay was brushed aside as an "administrative error".
Last April Lord Jones's support for Brown was called into question, prompting a swift rebuttal. But just months later he revealed plans to step down. "Does [the job] completely and absolutely monopolise your life? Yes, it does," he said. "Would I like a bit of my life back? Yes, I would." Out of government, Lord Jones is making life difficult for his former paymasters, just last week calling for half of Britain's civil servants to be sacked.
If Lord Jones's move from the City to government proved fractious, he is not alone. Baroness Shriti Vadera, a UBS banker for 14 years, has sat at Gordon Brown's side for eight years. Described as the Prime Minister's most trusted woman in government, she has also proved to be highly controversial.Last week's "green shoots" remark wasn't her first high-profile gaffe. While at the Treasury, she infamously described Railtrack shareholders as "grannies" who "added no value to the company", during the investors' High Court case against the Government.
Veteran businessman Paul Myners was hired by the PM last October in an effort to repair relations with the City. Unveiled amid the return of Lord Mandelson, Myners' appointment was derided by many in the Square Mile following criticism of private equity firms. That he was once a director of one of London's biggest hedge funds, GLG, which profits from short-selling activities, drew howls of "hypocrisy" from Conservative benches.
Others to hasve faced trouble include Lord Carter, the City's arch spinner and founder of financial PR monolith Brunswick, who became Brown's £140,000-a-year chief strategist in 2007. Just eight months later he was bounced out of the role amid reports of rows with the PM's inner circle and the resignations of several senior aides. After being granted his peerage, Lord Carter is now communications minister.
Back in November 2006, Lord Sainsbury, the supermarket billionaire and one of Labour's biggest individual donors, quit his role as science minister. Just 48 hours earlier he had been questioned by police over the cash-for-honours affair. Earlier that year he was cleared of breaching ministerial guidelines after failing to disclose a £2m loan to Labour.
When a beaming Mervyn Davies was unveiled as the new trade minister last week, standing behind him with a hand on his shoulder and an equally broad smile was his new boss, Lord Mandelson. Only time will tell whether Davies will join the list of businessmen who fail to replicate their corporate successes in the political world.
Curriculum Vitae: Mervyn Davies
1952: Born in Abersoch, Wales
1983-1993: worked at Citibank, where his roles included managing director, UK banking
1993: joined Standard Chartered
1997: appointed to the Standard board
2001: became Standard's group chief executive
2003: became non-executive director of Tesco
2004: became non-executive director of Tottenham Hotspur FC
2004: appointed Justice of the Peace in Hong Kong
2006: made chairman of Standard
2007: appointed chairman of Fleming Family & Partners
Other positions: chairman of the council of the University of Wales, Bangor; governor of the London School of Economics; chairman of the major projects board of London's Roundhouse; chairman of the Royal Academy of ArtsReuse content