There was a time when I thought that anybody running a country or a company or organisation was in that position because of extraordinary ability. I know now that it isn’t true but some part of me is still reluctant to accept it. For example I just can’t get my head around bankers who have ruined whole economies and got away with it – in fact who still get monumental bonuses.
Richard Quest has interviewed a few of bankers in Davos over the last week, and it’s mind boggling how they rationalize their behavior and that of their kind. Remorse? You must be kidding. Mr. Bob Diamond of Barclays (sounds like a Charles Dickens character) became chief executive at the beginning of 2011. In 2010 he was head of Barclays Capital. That year he got a £6.5m bonus, on top of his annual salary of £250,000, and a long-term incentive award of £2.25m contingent on future performance. £9m in all. His staff shared £2.5m. It’s obscene.
He has said before that he thinks the time for remorse and apology from bankers is over. What remorse and apology? The world is still waiting. When speaking to Richard Quest, he also said that it’s important to take emotion out of the equation. And he said it with a serious face. He’s feeling very virtuous as he accepted a much smaller bonus this year – £1.8m in shares and a deferred award of £4.7m in shares and contingent capital – bonds that convert into shares. It’s still obscene.
And now of course he’s staunchly backing bankers’ rights to be paid well for performance. But here’s the thing, what do these guys think their salaries are about? Well, Bob and his kind can carry on living in their bubble but it’s going to burst eventually. I wonder how any of them would cope if somebody destroyed their private little economies with recklessness and greed. I doubt it would be by suggesting the guy who anihilated them be paid an obscene bonus.
Richard Quest didn’t ask very pressing questions in his interview, but his attitude to Diamond was sober, fairly disapproving and clearly critical. Water off a duck’s back, though. That’s some pretty over-permissive entitlement Mr. Diamond has. In some ways I envy it. Survival of the fittest, grab what you can. I could certainly do with a bit more entitlement than I’ve got. But his is out of balance, I think, so he’s got to be paying a price at some level. He doesn’t look like a happy man.
These bankers, even though they don’t behave like it, are still human and are subject to the same laws of cause and effect as we all are. Greed at some level is fear-driven. And I hold onto the idea that somewhere inside every greedy, fear-driven bully beats a lonely heart.