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Posted By Bubb’s blog
On 4 July 2012 - 2:00pm

“Culture is difficult to define...but for me the evidence of culture is how people behave when no one is watching. "
That, believe it or not, was Bob Diamond last year. So it was inevitable he had to go. With ill grace and only after pressure but he is gone. He it was who told the Commons Select Committee that it was, "time to move on " after the bonus row. Now we know why it was not. 
Tempting though it is to direct anger at an individual who has shown the worst aspects of the industry, it is important not to think if only we get rid of some at the top we will be able to " move on".
In fact, what has now become clear is that the banking and finance industry does not understand accountability. It does not understand the need to take responsibility for its own decisions, nor to operate in a transparent fashion. An industry that structures its pay systems to favour self interest over customers and to glory in excess. 
So whilst individuals must pay the price for their greed, there is a clearer need for major reform of the industry as a whole .  Acevo , with colleagues in the sector have formed a " better banking coalition" which has been arguing for reform.
 The Prime Minister has recently set out the need for both accountability and transparency in the financial sector. He is right. We need action to secure this. It is clear that the arrogance of those  leaders  of the sector inhibits change- it is an industry palpably incapable of reforming itself.
The banking and finance sector have had since 2008 to wake up and smell the coffee (  Blue Mountain presumably ! ) and , as illustrated by the excuses and denials of  the British Bankers Association , they have failed to do so.
A major independent review of the industry and legislation is now required. But we know already some of the tools we need for this reform and we should put those in place now. 
One recommendation acevo have made is for the interaction of a US style  CRA( community reinvestment act). That sets out requirements for the banks to demonstrate where they are lending and to whom. It means that banks face penalties if they are shown not to lend responsibly and across all communities. The case for such an Act has been argued for some time- by no less a figure than Sir Ronnie Cohen amongst others.it is now time we had such an Act so that this industry can demonstrate transparency and accountability.  
There are also wider lessons from the way banks leaders have behaved. No one doubts there are thousands of very honest and good people in this industry. Our links with retail banking with RBS are good and I have spoken to many senior people in the bank who share my disgust at what has been going on.
On Friday we have our third sector CEO summit. As Chief Executives we know that one of our jobs is to set the culture and tone of the organisation. It is not possible to know the actions of all your staff. But you can be clear on what is right and ethical and what is wrong. Ripping off customers, as Barclays Capital have been shown to do, could not just have been a few rogues. The culture their clearly indicated such "big boy" behaviour was not just acceptable but encouraged. And rewarded by huge bonuses- the example set right at the top.
So at our CEO summit on Friday I intend to tackle this issue head on- not least because we meet at the RBS HQ in London.
Whilst I could understand the anger that my members feel at what has been going on we need to engage with the industry who are the foundation of growth that we need in the economy; argue for reform, and change in cultures.
With change we can reengage with the industry to make the case for broader lending to a wider community, to look at a growing role for social finance and loans to SMEs (amongst them third sector organisations).
The scandals at the top must be exposed and punished but the real task is reform.