Don't Bank on Our Current Generation

Want a better bank? You just need to wait until everyone who currently works in the banking industry retires and then, hey presto, you'll have one.

Want a better bank? You just need to wait until everyone who currently works in the banking industry retires and then, hey presto, you'll have one.

A report out today has concluded that it will take a 'generation' to change the toxic culture that currently exists in the banking world. That's right, a whole generation - a long wait by any terms. Read between the lines on this and it's a stark, depressing message: "We need to wait for the people who are causing all the problems to leave... there's nothing we can do to change them".

So, if this is the case, how are the banks going to isolate this toxic group, stop them from infecting the 'new generation' that's seen as the white knight for the banking industry? In my experience, failing to tackle the 'problem people' and focusing purely on 'the good ones' ends in tears and failure. The by-passed group become more disgruntled, more vocal and more damaging.

This feels like an admission of failure, complacency and half-measures. Banks, as has been demonstrated via taxpayer contributions, are pretty much invincible - one wobbles and we throw our money at it, one acts illegally and it throws our money at the fines. In short, why should they really bother? It's not like we have a choice.

What other industry would shrug its shoulders and say 'sorry... give us 30 years and we'll have some better people in place'? When Alan Mulally took over Ford in 2006 he immediately spotted a major cultural challenge, typified by internal rivalries and a lack of accountability. It took him less than eight years to fix, and to turn around a business that was staring bankruptcy in the face.

Many of the banks, the report recognises, have culture change programmes in place. But these are described as 'fragile' and do not 'ensure success'. This, to me, sounds like lip-service to the problem, something to waft in front of the regulators when they visit.

Culture change does take years, and it's not for the faint-hearted - many companies start it and quickly get scared off by the enormity of the task. But many (like Ford) push on, hold their nerve and keep the goal in sight when things get messy.

But the banks aren't, they are coming at this half-hearted, and we (again) are paying the price.

Thank you to the Cass Business School and think tank New City Agenda for their joint report.

Close

What's Hot