Russell Lynch: Action as well as words are needed from banks
Thursday 17 January 2013
Outlook Quiz time: which head of a leading British bank said this? "By being successful, banks can and should make significant contributions to society by facilitating the taking of appropriate risk by those they serve; by lending and investing; by paying dividends and taxes; by creating employment; and by contributing to the communities in which they operate. But if trust is to be re-established, then banks have to do these things in a way that serves society."
The noble sentiments aren't those of Antony Jenkins, the Barclays chief executive who today said there was "no choice between integrity and profit in this business". They're from Barclays' former chairman Marcus Agius, a victim of the Libor scandal, almost three years ago. Here we are again. Mr Jenkins assures us that the new drive for "integrity" isn't merely window-dressing or a PR stunt, even going as far as appointing 1,000 morality commissars to bring virtue's flame to the rest of the bank's 75,000 staff.
The wide boys on the trading floor swilling Bollinger with their mates while they celebrate rigging the Libor rate aren't welcome any more, Mr Jenkins says. "To be frank, we won't feel comfortable with you," he adds.
All well and good. But I'm sick of hearing mea culpas from the banking industry that are backed up with nothing more than warm words. It's like God's own banker, former HSBC boss Stephen Green, saying the industry "owes the real world an apology" a few years back while the company was laundering money for the Mexican drug cartels.
Mr Jenkins had better be ready to back up his words with action when he unveils his new strategy. And that means dismantling the aggressive and controversial tax planning business which dragged the bank through the reputational mire last year as it repaid £500m to the Treasury. Also making good on hints that Barclays will back away from agricultural trading and hence profiting from rising global food prices. If he's serious about "having the courage always to do the right thing", he might also want to think about the markets the bank is operating in, such as Zimbabwe. If he falls short, Barclays' moral revolution will be torpedoed before it's even begun.
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