In the City they're calling it "doing a Burberry". What financiers are referring to is the way that Burberry, once it conquered the London fashion scene, went on to storm another 30 or so cities around the world.
City grandees want to do the same. Instead of raincoats, the City is exporting its financial and regulatory expertise to places such as Moscow, Dubai and Toronto. The busiest catwalk is Moscow, where The CityUK, the Square Mile's promotional trade body, is the lead partner working with the Kremlin on developing the country's new International Finance Centre. Dubai signed up with The CityUK last week to work on its financial centre, and Toronto is said to be not far off.
Danny Corrigan, the deputy chairman of CityUK's Russian liaison group, coined the Burberry phrase for how the City is "copying and pasting" its regulatory, legal and accountancy standards on to Moscow. The Russian capital is already the third-biggest revenue earner for the City's magic circle of lawyers and accountants after London and New York. Corrigan, who runs the roubles desk at Icap, says financial experts are tripping over themselves to do business in Moscow – BA has just upgraded its route into the city, one of its most profitable and busiest.
Another Russian delegation was in London last week for talks on public-private partnership projects, while the Lord Mayor, David Wootton, is due to visit Moscow again in July. With Wootton will be representatives from hundreds of financial firms, including the London Stock Exchange.
Behind the scenes, the LSE is already working with the Moscow exchange on expanding its derivatives and securities market as it diversifies away from natural resources, but more concrete arrangements are likely. Nearly 20 per cent of London's market volume is now trading in Russian shares, so closer ties make sense.
The CityUK's Richard Normington says London was chosen – ahead of Frankfurt – because it sets the gold standard for regulatory work. You can be forgiven for being cynical about the City's high standards after the banking crash, but, apparently, London still leads the way on regulatory issues such as alternative resolution disputes, as well as branding. There may be construction work in the pipeline too – a decision on whether Moscow will build its own new Canary Wharf will be taken after its presidential elections next Sunday.
It's not just finance that's growing – trade is on the up, with Russia the UK's 12th-biggest export market. The Government sees long-term potential for the world's biggest country and eighth-largest retail market– there's a Burberry in Moscow's best shopping street.
Lord Green, the trade minister and former chairman of HSBC, has made Russia a priority. But he's also been criticised by MPs for allowing UK Trade & Investment to push Russia as a trading partner, because of worries over the regime. Indeed, Labour MP Denis MacShane lambasted Lord Green two weeks ago for hosting a London conference to sell Russia's new Skolkovo Innovation Park, because, he alleged, it legitimised a regime " plagued by criminality and corruption". One of Russia's richest oligarchs, Viktor Vekselberg, who is in charge of the project billed as Russia's Silicon Valley, was the main speaker at the event, which drew more than 100 British investors and scientists.
Vekselberg is one of the three oligarchs who own half of TNK-BP, the joint venture with BP. The UK oil giant is one of the first to work with Skolkovo, agreeing a £9m grant to back Imperial College and its Russian university partner for research into oil refining.
Ironically, one of the stated aims of Skolkovo is to stop the brain-drain – and money drain – to cities such as London; Russia wants the Brits to go there instead. But should UK companies be expanding into Russia? Or will new players get burnt, as MacShane suggests, like the hedge fund Hermitage or BP?
Who better to ask than David Peattie, BP's head of Russia? BP is the biggest foreign investor in the country. Peattie says the TNK partnership has been a huge success, despite its ups and downs. Since TNK-BP was launched in 2003, Russia has earned $150bn (£95bn) in taxes and duties, while BP has made $19bn in dividends – and the dividend to BP's shareholders last year was largely covered by the $3.7bn TNK cash dividend. While the spat with TNK over the failed Rosneft deal is still going through the courts, Peattie says personal relations with the three oligarchs are good: "There's never a dull moment."
But is it worth the gamble? BP certainly thinks so, as does The CityUK, which points out that it's because the Russians want to improve their reputation that the City has been invited in.
Who knows? But maybe the City can do some good by helping to check the wilder side of the Russian bear.
Darrington takes a bite out of businesses which refuse to accept pay criticism
Hooray for Sir Michael Darrington, the former chief executive of the cheerful Greggs pie-to-pastry shops. Darrington brought some much-needed sense into the great pay debate last week when he said business was wrong to view the recent criticism of boardroom pay as anti-business.
Quite the reverse, he says. It is business that is being anti-business by attacking the criticism, and by defending its own pay levels. Or, as Darrington put it with the bluntness of a Greggs butty: "It is a smokescreen and a lot of bollocks – it is the greed of the people [at the top] that is anti-business."
What friends he may have in the business world will have been tearing their hair out when he added: "If the current packages were halved, senior executives and bankers would still be overpaid."
If business does want society to be pro-business – which largely it is – then more notice should be taken of Darrington's comments. While he's the latest to break ranks with his peers, and now plans his own campaign against excessive boardroom pay deals, he's not the first. That accolade goes to Sir Owen Green, the ex-boss of BTR that became Invensys, who was the first UK businessmen to warn on excessive pay awards in the early 1990s. Owen predicted then that the sky-high packages being paid to businessmen would lead to social problems, even civil unrest. Public shame was his answer to the problem.
Antonio Horta-Osorio, the thoughtful Lloyds Banking Group chief executive, seems to have taken this on board. His decision to claw back bonuses from executives at the time of the PPI mis-selling scandal is the right one, and he should be praised for taking such a bold move. As Lloyds' results showed, the bank has also slashed bonuses to executives by 50 per cent – and to staff by 30 per cent – following its £3.5bn loss. Taxpayers are now sitting on a £10bn loss.
RBS also cut back its bonus pool. If your company is loss-making, you could argue that executives shouldn't be taking any bonus at all. Being pro-business means you share in failure as well as success.