The current Barclays scandal has gathered momentum and has now gone way beyond “it had insufficient business controls” as the recent Guardian article today, Barclays Libor scandal: how can we change banking culture? spells out in graphic detail. The UK population has been well and truly bankered.
To sum up the excellent article
According to the IMF, the British stuck £1.2 trillion behind the finance sector. Read that again: well over a trillion pounds in bailouts, and loans and state guarantees on bankers’ trading.
In just a few months, and with barely any public debate, every household subbed £46,774 to the City. A sliver of that money eventually went unused; as for the remaining hundreds of billions, we have no idea just how much we’ll get back – or when.
There is talk of how to change the culture of banking. As usual there is lots of rhetoric and bold statements made by the executives. But this is an operational issue and boils down to metrics and processes.
People are driven by metrics. They act as they are measured. Bankers with expensive lifestyles to maintain are driven by money – metrics. But they need clear guidelines to ensure that hit their metrics without cheating – transparent processes and business controls. This needs to be through the entire organisation – top down.
Nothing else changes culture. Not MP’s getting passionate in the House of Commons. Not threats of prison for the senior people. Not the resignation of the Chairman.
Putting in place the framework of processes and metrics throughout an organisation is very achievable as countless Nimbus clients can demonstrate. In a couple of minutes you can see how BAE Systems transformed its Shares Services operation in this video.
Now Barclays are undertaking and independent audit – but this will highlight the problems. Far better if that work is a process-driven where the outcome is a operational process model with related metrics. Something that will change the culture. Not a report for the Barclays spin doctors.
And the good news is it will take less time that any “formal investigation” and cost less that £46,774 per person