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Banking, Change and Us

I took a trip up North recently to the beautiful hills of Galloway to take part in a panel discussion with Martin Vander Weyer, Business Editor of the Spectator, Carl Wilkinson of the Financial Times and Dave Patrick of the ‘Ban Bankers Bonuses Party’  at the Wigtown Book Festival.  Attended by a lively audience of over 200 people, the topic was “The Mindset of Bankers”.  

The potential to see bankers as narcissistic psychopaths was raised in various forms, but in general the mood was that banking failure was not something caused by abnormal people, but people like us in abnormal situations.
Less generally felt, but recognised by a significant number, was the perspective that the banking crisis and the global financial turmoil it has caused was as much a reflection of us as that of bankers. As a Dublin taxi driver said to me once “Y’can get mad with them banks but I was the ‘feckin’ idiot who bought a holiday let in Bulgaria!”

We were all in it: Journalists who lauded the banks and other financial institutions and now make a living exposing their ineptitude; politicians who cozied up; consultants who said what people wanted to hear for fat fees all had a part to play. But even wider than that, there are the millions of us who sensed that things could not go on but chose not to think or say anything about it and even more paradoxically chose to act as if what we strongly suspected was going to happen, wouldn’t. Undoubtedly there are some of us who did not take advantage of cheap credit, or chase the property ladder, or perhaps encourage our children to do so.  Most of us though, in some way, were and are involved.

If we want change, this makes it very difficult.  The way I have always tried to think about change is at a systemic level: focusing on the way all the different elements of a problem dynamically interact with each other. This includes the ‘politics’ and emotional content of a situation as much as the structures and process that need transforming.  If this is a useful way of thinking about change in an organisation it must be even truer of an economy. At Wigtown there was much discussion of ‘banning banker’s bonuses’; criminalising certain activities and reducing the senior executive pay. Just as easily other audiences could have highlighted the failures and possible reforms in the way politicians operate; or the role of the media.  In the end, we need both to acknowledge all of these factors are at play and to ask ourselves, what is our part in the change? All change starts with individual responsibility, individual action and individual choice.

Comments on this Post

Jeff Eggleton on 23rd October 2012

Interesting comments, which ring true to me. The past is the past, and bad as it was we need to move on and see real change for the future. The solution is often in the past however. For me, this starts with the banks....not by clamming up and not lending at all. This is patently unhelpful and not constructive. I want to see banks go back to basics. Lend on fundamentals, not pie in the sky. But DO lend. This to SMEs as well as individuals. Real bank managers in the community making real decisions for which they are responsible is a step forward. Less commission based lending and selling. There was too much hard and inappropriate selling in the past. Less money should be offered to bankers in general for doing ultimately a very simple job. Bonuses should be really earned with a blend of KPIs not just crude sales numbers. And finally, ultimately we all need to be a bit more responsible about how we spend and borrow. Not sure how that will come about but education when very young is perhaps one way. Thanks for the article. Jeff Eggleton

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