Leather, plate and chainmail all had their day in the history of armour. In our own times, however, the panoply of choice is a suit of solid gold. Bank bosses deflect the charge of overseeing skulduggery by suggesting that their highly paid time is simply too valuable to be squandered on figuring out what lowly subordinates get up to. While the towers of finance were ablaze in 2009, Sir Fred Goodwin, as he then was, was charged with lighting the match. He offered a full corporate apology, but also pleaded: “It’s too simple if you want to blame it all on me.” At the same parliamentary session, Andy Hornby, who went on to many more lucrative jobs, grovelled on behalf of HBOS, which he’d recently led, but added: “I don’t think I am particularly personally culpable.” Some time after HSBC was caught money-laundering for Mexican drug cartels, (Lord) Stephen Green conceded only “problems of implementation” down the line, while Bob Diamond at Barclays tried to cling on through the Libor-rigging scandal by pointing the finger at rogue traders.
At the public accounts committee this week, HSBC bosses confronted parliamentarians with a game out of the usual playbook. The big boss during the years when sharp practices in Switzerland were costing the public purse millions was Lord Green, who went on to be a Tory trade minister. But he wasn’t called by the PAC and is unlikely to be bothered by the Treasury committee either, because Conservative members would rather ease off until polling day. The current non-domiciled chief exec, Stuart Gulliver, was a pioneer of offshore private banking, at one point being paid via a Panamanian company, and yet he cannot, he maintains, be blamed for the rogue operations of a Swiss arm which he knew nothing about. Then there was Rona Fairhead, the half-million-a-year non-exec, who accepts that public anger is justified, but insists it would be better directed below board level. Ms Fairhead may have been in charge of the audit and risk committee in 2007, but the blame did not lie with her, but with “frontline” employees and greedy customers.
Risks have been run with the bank’s reputation, but the only audit has come from the Guardian and Panorama. The most immediate questions should surely concern her HSBC role. Instead, the loudest calls to quit have centred on her second, less lucrative job, as chair of the BBC Trust. This is an irony which owes something to the press-savvy touch of the PAC chair, Margaret Hodge, who sensed that airing disgust “as a licence-fee payer” about such a lackadaisical scrutineer would reverberate through the media scrum. But it owes something, too, to a cultural divide between purely commercially corporate management, and that in public bodies, such as the BBC.
Jonathan Ross’s dirty phone pranks had little to do with the Radio 2 controller, Lesley Douglas, but she still had to go; so did BBC1 boss Peter Fincham, in a row about an unflattering edit of footage of the Queen. Greg Dyke and Gavyn Davies were both toppled from the summit by one reporter, in one early broadcast, getting a little ahead of his notebook in claims about Tony Blair’s dodgy dossier. Newsnight’s blunders over paedophilia did for the brief director generalship of George Entwistle. The fact that it was not him who made the fateful editorial calls did not save his bacon as it might have done in a bank; rather, it sealed his fate.
Public managers are still sometimes called unsackable and yet it was not Sharon Shoesmith’s personal failing of Baby P, but those of her department that led to her dubious dismissal. Whitehall mandarin Sir Paul Gray fell on his sword because somebody else left discs of child benefit data on a train. Would top bankers have gone in such cases, or shunted blame down the line?
The theory of ministers taking the rap for departmental misdeeds they knew nothing about is rarely honoured in practice, but at least voters have got the option of giving them the boot at the ballot box for failures that they’ve overseen. But the writ of democracy does not run in banking, which makes it all the more important that those paid obscene salaries take the responsibility that goes with it. This week we have once again seen that the rule is instead grab the cash, then run for cover.
