Co-op Bank’s board was ‘like the UN’

 

Associate Business Editor

The Co-operative Bank was run by a board so unwieldly that looked like corporate equivalent of the United Nations, at least according to the people who sat on it.

Another likened it to Parliament and so it is scarcely a surprise that they were gravely concerned about the lack of “effective debate and challenge” concerning “long-term strategy, the competitive landscape and executive succession”.

Those damning observations were made by directors during interviews conducted by Dr Tracy Long and her colleagues at Boardroom Review, an organisation which offers assessments of the effectiveness of company boards.

Her 2010 report into Co-operative Financial Services, including the bank and its insurance businesses, stressed it was “not for external use including the FSA”, a reference to the Financial Services Authority, then the chief City watchdog and the bank’s regulator.

In it one director moaned about the “lip service” paid to conducting useful discussions and  another asked plaintively whether the institution was becoming “the emperor with new clothes” in relation to  its business transformation programme.

Most of his colleagues wouldn’t have been able to answer that – while the report found that they understood the institution’s financial plan they were not at all clear on “what the business is going to look like or become”.

The paper was published by one part of the UK Parliament that does work; Andrew Tyrie’s Treasury Select Committee, as part of its investigation into Co-op’s disastrous failed bid for the 600-branch-strong Verde business. It was followed by the bank’s near collapse as a result of the Bank of England identifying a £1.5bn hole in its accounts.

The committee has got into the habit of saving the publication of its most eye-opening materials for a Friday, and the review is certainly that.

Its recommendations include slimming the board, a point made repeatedly during the committee’s hearings.

The two characters that emerge with the most credit are Paul Flowers, the former chairman who was described as a “skilful and effective” as well as “focused, diplomatic, perceptive and conscientious”. The review found that he “commands respect”.

Meanwhile, the chief executive Neville Richardson was praised as an “effective and inclusive leader” who was “a breath of fresh air”.

The former has since been disgraced amid a series of lurid revelations. The latter has been publicly criticised by the Bank of England. These two, according to their colleagues, were the best of them.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
The Doctor and Clara have their first real heart to heart since he regenerated in 'Deep Breath'
TV
News
people
Life and Style
Apple showed no sign of losing its talent for product launches with the new, slightly larger iPhone 6 making headlines
techSecurity breaches and overhyped start-ups dominated a year in which very little changed (save the size of your phone)
Arts and Entertainment
Tracy Emin's 1998 piece 'My Bed' on display at Christie's
artOne expert claims she did not
PROMOTED VIDEO
News
Young Winstone: His ‘tough-guy’ image is a misconception
people
Sport
Ashley Barnes of Burnley scores their second goal
footballMan City vs Burnley match report
Arts and Entertainment
Man of action: Christian Bale stars in Exodus: Gods and Kings
film
News
The official police photograph of Dustin Diamond taken after he was arrested in Wisconsin
peopleDownfall of the TV star charged with bar stabbing
Arts and Entertainment
Peter Mayhew as Chewbacca alongside Harrison Ford's Han Solo in 'Star Wars'
film
News
Ernesto Che Guevara and Fidel Castro, right, met at Havana Golf Club in 1962 to mock the game
newsFidel Castro ridiculed the game – but now investment in leisure resort projects is welcome
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

Selby Jennings: Quantitative Research | Equity | New York

Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...

Selby Jennings: SVP Model Validation

Not specified: Selby Jennings: SVP Model Validation This top tiered investment...

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

Day In a Page

A timely reminder of the bloody anniversary we all forgot

A timely reminder of the bloody anniversary we all forgot

Who remembers that this week we enter the 150th anniversary year of the end of the American Civil War, asks Robert Fisk
Downfall of Dustin 'Screech' Diamond, the 'Saved By The Bell' star charged with bar stabbing

Scarred by the bell

The downfall of the TV star charged with bar stabbing
Why 2014 was a year of technological let-downs

Why 2014 was a year of technological let-downs

Security breaches and overhyped start-ups dominated a year in which very little changed (save the size of your phone)
Cuba's golf revolution: But will the revolutionary nation take 'bourgeois' game to its heart?

Will revolutionary Cuba take 'bourgeois' golf to its heart?

Fidel Castro ridiculed the game – but now investment in leisure resort projects is welcome
Ed Richards: Parting view of Ofcom chief. . . we hate jokes on the disabled

Parting view of Ofcom chief. . . we hate jokes on the disabled

Bad language once got TV viewers irate, inciting calls to broadcasting switchboards. But now there is a worse offender, says retiring head of the media watchdog, Ed Richards
War with Isis: The West needs more than a White Knight

The West needs more than a White Knight

Despite billions spent on weapons, the US has not been able to counter Isis's gruesome tactics, says Patrick Cockburn
Return to Helmand: Private Davey Graham recalls the day he was shot by the Taliban

'The day I was shot by the Taliban'

Private Davey Graham was shot five times during an ambush in 2007 - it was the first, controversial photograph to show the dangers our soldiers faced in Helmand province
Revealed: the best and worst airlines for delays

Revealed: the best and worst airlines for delays

Many flyers are failing to claim compensation to which they are entitled, a new survey has found
The stories that defined 2014: From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions

The stories that defined 2014

From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions
Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations

Disaster looming? Now you know where to head...

Which British city has become the first to be awarded special 'resilience' status by the UN?
Finally, a diet that works: Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced

Finally, a diet that works

Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced
Say it with... lyrics: The power of song was never greater, according to our internet searches

Say it with... lyrics

The power of song was never greater, according to our internet searches
Professor Danielle George: On a mission to bring back the art of 'thinkering'

The joys of 'thinkering'

Professor Danielle George on why we have to nurture tomorrow's scientists today
Monique Roffey: The author on father figures, the nation's narcissism and New Year reflections

Monique Roffey interview

The author on father figures, the nation's narcissism and New Year reflections
Introducing my anti-heroes of 2014

Introducing my anti-heroes of 2014

Their outrageousness and originality makes the world a bit more interesting, says Ellen E Jones