Royal banks on women
If you're looking for signs that Royal Bank of Scotland has changed since it hit crisis, its chairman wants to highlight its right-on attitude to women.
It might seem one of the lower priorities for a bank having an annual general meeting half way through its recovery plan, when it is reporting a £1.1bn loss.
And it's true that Sir Philip Hampton's speech to shareholders has other notes to hit.
He's highlighting the cost of bank reforms, as outlined in the interim report of Sir John Vickers' Independent Commission on Banking.
Taking out cross-insurance and requiring separate capital buffers will cost customers and shareholders, he points out.
And the British public are, of course, the majority shareholders, which is one very good reason why the bank's bosses are, unlike others, not threatening to take their headquarters to other countries in pursuit of lower tax and less regulation.
The chairman highlights the payback to the public of getting the share price up, at a rate of £900m of value for each penny.
Hester trousers
While announcing that RBS is wrapping the former bits of ABN Amro into the plc's core, removing the legal legacy of a separate Dutch entity, Sir Philip Hampton is taking on the critics on executive pay.
And with his chief executive, Stephen Hester, trousering £7.7m for last year's loss-making work (OK, to be fair, some is sewn into a trouser pocket he's not allowed to unpick for a while), there's quite a lot of criticism kicking around.
UK Financial Investments, or UKFI, which represents the UK government's interests as shareholder, has already approved the remuneration report, so there's not much prospect of the criticism derailing executive pay.
But Sir Philip wishes to emphasise the role of pay in continuing to retain and recruit staff.
On that, he offers an astonishing figure: since the crisis hit in October 2008, while you might think RBS has seen a one-way traffic of exiting staff, it's actually recruited 46,000 people.
That's slightly less than a third of the staff total, and represents a colossal churn.
Distaff staff
Anyway, to women. Shareholders have been told today that RBS is looking for more of a female presence on its board.
The chairman didn't actually address the argument that the bank might have taken fewer risks if the board, in Sir Fred Goodwin's day, were a bit less testosterone-driven.
But it's implicit in his embrace of the drive for female recruits.
The message is also aimed well below board level.
"Female engagement" became a priority last year, we're told, focussing on recruitment, progression, development and networks.
"We worked hard" to ensure that at least one woman featured on the shortlist for executive vacancies, he said, and rolled out "a global diversity training module focusing on the subject of 'unconscious bias' to all employees internationally".
It's hard to imagine Sir Fred Goodwin taking this line in the RBS of yore.
Some may see it as that old chestnut of "political correctness gone mad", but it's also a bank trying to show it's in tune with the political and social environment within which it operates, rather than a purely and exclusively financial one.
That, and the financial calculation that a happy female workforce is good for the bottom line too.
In case you missed it, there was a telling observation close to this subject from Jayne-Anne Gadhia, chief executive of Virgin Money and a former RBS lieutenant of Sir Fred Goodwin, in the interview for Radio Scotland's Business Scotland last weekend.
She said Sir Fred Goodwin ran a company where it was clear what you were expected to deliver, whereas Sir Richard Branson runs Virgin as a company where people ask what they can do to help you deliver.
Perhaps a useful contrast and lesson for any business.
Hullo, I'm Douglas Fraser, and I'm business and economy editor at ´óÏó´«Ã½ Scotland. Welcome to my blog, where you can read my take on money matters, viewed from a Scottish perspective.
Comment number 1.
At 19th Apr 2011, Wee-Scamp wrote:Question: How many RBS executives are based in Scotland?
The answer: not a lot. But, Sir Philip insists Scotland is "very important".
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Comment number 2.
At 19th Apr 2011, Secretbanker wrote:As a former RBS/Nat West employee it makes me laugh to see the way RBS tries in vain to rehabiliate itself. Remember a 'Moneysense' employee in every Nat West branch to help those in difficulty ? Lasted about 3 months. The customer charter ? How long have you queued on your last visit ? Never mind, fudge the results and present it as a success. Recruited 46,000 !! What about redeploying some of those you sacked (er sorry made redundant) ? Now more women on the board. Believe me, most talented women wouldn't touch banking with a barge pole. I have heard the internal sexist comments made by managers and know the culture well. Who are you kidding ?
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Comment number 3.
At 19th Apr 2011, xyz wrote:Was it not a woman Blythe_Masters who "invented [the] financial weapons of mass destruction" otherwise know as Credit Default Swaps which Precipitated the 2007 global Credit Crunch?
Who cares if our tormentors are male or female?
I say keep the banks publicly owned, cut their pay to something sensible and throw out the private banks.
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Comment number 4.
At 19th Apr 2011, dotalot wrote:This is disgusting! Do we pay our "talented and motivated" doctors this kind of money - no, we don't have to as they are moral beings.
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Comment number 5.
At 20th Apr 2011, PetePat wrote:There has been a loss of moral compass in the wholesale banking community. The people who are paying the price for saving the bankers are, in some instances, losing their homes. Pay packets and bonuses of this magnitude should be refused until the country has been repaid and the banks are doing the job required of them. It is clear that all new legislative proposals are insufficient to the needs of the moment.
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Comment number 6.
At 20th Apr 2011, markaval wrote:Why are we falling this load of balloney of paying people bonuses for doing their job? Isn't that what these people get paid for? 'Risk-sensitive' - what a load of tosh. Bonuses should be paid for exceptional performance, well above and beyond what is expected of the job. Call me a bluff old traditionalist, but I don't call causing a global crisis with financial repercussions that will last for probably a generation worthy of being described as 'exceptional performance'. Neither do I call culling tens of thousands of jobs and milking hard working customers with hidden excessive bank charges as exercising 'exceptional leadership'.
Any muppet can take a hatchet to the work force - it takes real leadership to work out a way to motivate the work force to better productivity whilst minimising the need for large scale job cuts. But that would mean doing some REAL work and exercising REAL leadership...can't have that can we?!
If your job requires you to be 'risk sensitive' then that's what you collect your pay packet for each month. You should not get bonuses for just doing your job, and certainly for not doing it particularly well according to some emminent economists.
This is money for old rope and the old boys network determined to hang on to lucrative and totally unneccessary bonus schemes under the guise of 'retaining the best staff' - they weren't THAT good were they, considering the mess the world is in financially! It's simple greed on a scale that is mind boggling - and our Government seems to be complicit in allowing the banks to carry on, 'business as usual' using the lame old excuse of not wanting to disincentivise banks from doing business in the UK. Get them to bugger off and get new blood into the banking system with new approaches and new ideas - like every other business is being told to do by the Government who expect 'more for less'.
The simple FACT is that the banks caused the global crisis - they should assume collective responsibility for funding the defecit reduction rather than pouring the whole of the burden on to the normal, hard working person who was guilty of nothing more than using the services offered by the banks.
If you or I robbed a bank or were financially irresponsible and defaulted on our mortgage then WE would be held responsible, and the banks would be the first to come knocking on the door expecting - no - DEMANDING their money back - what's the difference with the global economic crisis caused by corrupt and incompetent banks and CEOs? None. The whole thing stinks like week-old daipers.
Rant over :-)
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Comment number 7.
At 20th Apr 2011, anotherfakename wrote:Well RBS has lost one customer at least because of this.
I would suggest those people who are customers of this hugely greedy individual do as I have done, walk away. With no customers there will be no bank.
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Comment number 8.
At 20th Apr 2011, Kit Green wrote:5. At 07:51am 20th Apr 2011, PetePat wrote:
There has been a loss of moral compass in the wholesale banking community.
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It seems that some court action is trying to look for their compass.....
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Comment number 9.
At 20th Apr 2011, RW49 wrote:UKFI okd Heston's bonus and, presumably, all the others, and why is this guardian of the tax payers' investment so generous? Because the board of this organisation is stuffed with passed and present financial types who have spent time on renumeration committees handing out humungous bonuses to, er, bankers.
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Comment number 10.
At 20th Apr 2011, WolfiePeters wrote:Bankers are brilliant. The bosses must be the most brilliant of all.
We give them our money. Often, they charge us for taking care of it.
They gamble with our money. If they win, they keep it. If they lose, we cover the losses.
If they lose so badly, they have to leave their jobs, we pay for them to have a huge pension. A pension so huge that it would cover an engineering manufacturer to develop a major, innovative product. Of course, that’s if we had any manufacturing industry left, but the Government and the bankers couldn’t justify saving them when they had difficult times.
Let’s be honest, to get away with all that, either they’re brilliant or the rest of us are so stupid .... .
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