Friday, January 18, 2013

An open letter to Anthony Jenkins at Barclays Bank.

Dear Mr Jenkins,

I have heard it reported that you have told the bank's 140,000 employees to sign up to a new code of conduct, or leave.
This is a very brave act on your part, albeit far too little and far too late, but better than nothing. For far too long, you all laboured under the malign influence of Don Roberto, who focused you all on short-term gains to the greater detriment of your longer term ambitions, you clients, your values, and ultimately, your reputation. For 20 years Barclays manifested an increasingly aggressive work culture, which, I am now told, you recognise as focusing too much on making a quick buck instead of upholding the values and long-term reputation of the bank.
Why didn't you say all this when the Godfather was at the helm? Was it politically not expedient? Why didn't you stand up in front of the Board and put it to them that they were behaving like a second-rate loan sharking enterprise? You could have done so, although I wouldn't have given a brass razoo for your chances of keeping your job very long. How much money did you earn in bonuses for staying shtum all those years, you can probably begin to see why I am not all that impressed by your Damascene conversion to the straight and narrow all of a sudden!
Your Private Banking arm was so bent that a friend of mine who was briefly head of anti-money laundering, left, because as he put it, he wanted to get back to knowing how it felt to sleep at night.
Between you all, and you were part of the management structure at the time, let us not forget that, you took a once-proud and major bank, and you trashed it. Bob, 'The Capo' Diamond had to quit over Barclays' role in rigging the Libor rate used in trillions of pounds of financial contracts. You were just the first of several international banks to be implicated in this particular scandal, and you were fined a total £290m by US and UK regulators. You got off cheap!
Worse still, you, along with most of the other major UK High Street lenders, has also been found culpable in recent years of defrauding large numbers of your customers by cheating them with unnecessary payment protection insurance to mortgage borrowers, and overly complex, over-priced interest rate and currency hedges to small businesses.
You have now got some very hard miles to cover to bring your institution back to where the public will trust it once again.
I am told that your requirements are that staff now sign up to five key values - respect, integrity, service, excellence and stewardship.
These are fine-sounding ambitions, Mr Jenkins, but what do they mean in an institution such as yours which has rejected all respect it may have held for its customers; lost any integrity it might once have possessed; failed repeatedly to give good service to its clients; forgotten the meaning of what it means to provide excellence; and failed to demonstrate anything remotely like stewardship for years.
I have bitter experience of the way you treated your customers, I used to be a client of yours, and I would never, repeat never, willingly renew that relationship.
I am told that these demands of yours come at the same time as staff prepare to learn what bonuses they will receive for their services in 2012, and that bonuses in future will be assessed against the new "Purpose and Values" criteria.
In my judgement you have already failed my first test of true sincerity. What bonuses are you intending to pay this year? What have any of you done to deserve any bonus payments. Bonuses are supposed to reflect good work, added value, integrity, going the extra mile.
What has 2012 signalled for Barclays? Fines for LIBOR rigging, Fines in the US for electricity market pricing fiddling, I mean how much more criminality are you willing to condone before you decide not to reward it with bonuses. There are hundreds of thousands of hard working men and women in this country, many of them your customers, God help them, whose salaries have been pegged, cut back, frozen and who have not seen an increase for some time. Their costs of living are going up, their children are facing massive debts for university education, something you would have got for free, their elderly parents are wondering whether this Government of your friends are going to remove their winter fuel allowances, and their bus passes, and you are talking about paying bonuses to your organised criminal employees! Have you lost your entire sense of proportion, man!
I know you have been talking tough to some of your crooks and spivs, telling them "There might be some of you who don't feel they can fully buy in to an approach which so squarely links performance to the upholding of our values."
I guess you thought it sounded messianic when you said, "My message to those people is simple: Barclays is not the place for you. The rules have changed. You won't feel comfortable at Barclays and, to be frank, we won't feel comfortable with you as colleagues."
Well, you are going to have to prove that you can walk the walk as well as just talking the talk. You failed another test of integrity when you appointed Hector Sants, former boss of the Fantastically Supine Apologists, to head the new Barclays' compliance department.
I don't quite know what you think that ' great big soppy old Hector' is going to do for your new image, he was asleep on his watch at the FSA, or so the Parliamentary Select Committee found, and you then went and rewarded him with some massive pay deal. No doubt he will be part of the new package which you are reported as saying  would "excite" the workforce.
So, as part of my message to you, I thought I might send you some good ideas with which to underwrite your new squeaky-clean image.
First, get together with your Department Heads, and your HR department, and demand to be given a list of all the highest earning staff members in terms of bonuses and commissions, and then get rid of them, fast.
These are the people who will have been causing you most of your problems in terms of cutting corners, cheating the rule book, ignoring the regulations, rigging LIBOR, etc, etc. By sacking them, you will send a very loud message to the rest of the teams that you really mean what you say about starting the way you mean to go on, and it will have a salutary effect. Most of these really high-earners are routinely loathed by their peers who see them as cheats and liars who are being allowed to prosper.
Remember, most people like working in an ethical environment. I know I know, after all these years of working for the most crooked bank in the High Street, to suddenly learn that the vast majority of staff like working in an ethical workplace must come as something of a shock, but it is true!
Next; buy in some top-notch training in ethics, integrity, honesty and commercial morality and insist that every employee from yourself, down to the office cat attends. Don't give this project to one of the BIG Four consultancies, bring in someone from outside who really specialises in proper ethics consulting.
While on the topic of the Big 4, radically curtail the amount of money you spend on them, because in most cases they are not part of your solution, they are part of your problem. You should be capable of employing good staff who have the necessary experience to be able to deal with most of these issues without  having to spend the amount of money you do on the Big 4. They are a waste of time and space and they cost you a fortune. They are in the business of consolidating so many of your bad practices and bad habits, and you can get by without them. If you doubt this wisdom, read an incredible book entitled, 'Dangerous Company' by James O'Shea and Charles Madigan and realise why you don't need to spend the money these people cost you.
When it comes to recruiting staff, stop spending money on recruitment agencies, they are another parasite industry who are draining you of revenue. They employ young people straight out of university to engage in a box-ticking exercise when it comes to recruiting staff. Do it yourself, that's what your HR division is for.
Pay particular attention to the quality of your compliance and Anti-Money Laundering  teams, and make sure you hire the very best people you can. Pay them well, and understand the value of age and experience. Don't rely on loads of wet-behind-the-ears kids who are paid peanuts, but who become another box to be ticked by the regulator. Hire quality and experience, and stop being so ageist! Just because someone is over 55 doesn't mean they have forgotten all they ever knew. Pay a premium for skills and experience, and look for grey haired people who can offer proper mentoring for young people, helping keep them off the crooked path.
Remember, managing people is like herding cats. Every single person is different, so make sure you reward common traits. Reward honesty, integrity, and adherence to best practice, and watch very carefully for signs of the 'star performer'.
Rigidly demonstrate a commitment to an anti-bullying program in the workplace. Bullying is one of the most commonly corrosive and damaging influences in the workplace these days. Instigate a programme of in-house training to encourage staff members to identify bullying, and help stamp it out internally. The same goes for sexism, racism and any other kind of exclusionary behaviour.
In your trading rooms, make sure you discourage any signs of sexist conduct against staff. Do not be willing to condone 'laddish' behaviour which all too often is aimed at ambitious women, seeking to destroy and undermine their effectiveness and efficiency. Stamp out any such behaviour ruthlessly.
Encourage regular medical examinations for signs of excessive drink or drug abuse. Too much money has been lost because the trader or broker bolstered his pathetic ego with a snort of Colombian marching powder or a drink too many. Make drink and drug testing in the dealing rooms the same as if these staff were Olympic athletes. They are supposed to be the best in the market, or so you repeatedly tell us, so treat them as such and make sure they are not short-changing you.
Encourage staff to obtain additional educational qualifications through part-time study, day-release, night school, etc, and reward it. You are allowing them to add value to their personal work-life balance, you are encouraging them to educate themselves to acquire higher skills and knowledge and they will reward you for this commitment. In addition, encourage staff to undertake meaningful voluntary work in the local community, whether working with children who have reading difficulties, or helping old people who need extra assistance. Whatever the model, make sure it is recognised as being part of the firm's ethic and ensure it is suitably rewarded.
Make bonuses mean something. Instead of dishing out hundreds of thousands of pounds, all of which merely encourage staff to adopt the shortest of short-term policies, pay fair, but small bonuses, no more than a couple of thousand pounds at the most, and only then for real evidence of integrity, ethical or honest conduct. In this way, staff will not need to behave in unethical or illegal ways, just to guarantee getting their bonuses.
Finally, make sure that the legal compliance requirements of the lead regulator are implemented properly and in their entirety. Encourage a dialogue with both the regulator and the criminal intelligence services who rely on suspicious financial disclosures, and enter into gateway agreements with them to ensure that the rules on compliance and money laundering are being adhered to. Share your experiences with them, and stop the present atmosphere of distrust and contempt from growing.
If you can do these things Mr Jenkins, you might just have half a chance of succeeding. For my money, I remain to be convinced. Leopards and spots comes to mind all too easily.


Unknown said...

Have you sent this to Antony Jenkins?

AbogadoNZ said...

A good comment from Elaine. I hope you have sent it as it is cogent, accurate and 'on message'. Barclays like many other banks needs a thorough clean out and I doubt very much Jenkins has the balls to do it. He will merely close his eyes and ears and pick up his fat salary each month. The fact that he is prepared to lead a company convicted of serious criminal activity and not seek out and remove those responsible says it all.

Steve said...

Possibly the most sensible letter to Barclays I have ever seen - I worked for them for 27 years in the IT department and I could write a book on Barclays ! In the 80's it really was about customer service (they used to send us on loads of customer service courses all the time) they lost their way in the last 10 years courtesy of American top dogs and USA and UK fiscal incompetance. (Bob Diamond wasnt the first American who started screwing Barclays by the way). Can you post a reply to let us know if this has gone to AJ as if it hasnt I will send it - his reply would be interesting.

Rowan Bosworth-Davies said...

Thank you to all of you who took the time to write your observations on this post. I have not sent this to AJ because I do not feel it is a blogger's place to single out individuals for special treatment, it smacks of bullying on my part. Even if I had sent it, I doubt he would have seen it, people like him have ways and means of insulating themselves from publications such as mine. However, if any of you know of ways to bring this blog to his attention directly, then please be my guest!

The Fatsnacker said...

lifeafterdebt said...

Some really sound suggestions in this piece Rowan but suspect Barclays are only paying lip service to getting their house in order in an effort to divert the bad press. Hope I am wrong.

Unknown said...

Well said. Excellent idea to send a letter to Antony Jenkins. I hope you'll share his response here. Thanks for sharing.

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