Banking and morality - the debate continues
The news that banks appear so quickly to have forgotten the crisis into which they plunged us all has not gone down well. This appears to be the case in government.
To some extent, that banks are generating operating profits now is what we want - we need banks to be profitable to help restore the financial system. However, the sector has to work out how to do things differently and how not to cause such chaos again. It must recognise that it has required taxpayers to assent to a massive state intervention, for which they will be paying for some time to come.
Speaking at the Financial Times Global Finance Forum on Friday, Financial Services Secretary Lord Myners stressed that while the government was determined to regulate the financial sector, regulation alone was not sufficient. Banks needed to take responsibility:
"Corporate leaders in the global financial sector have begun to talk about addressing moral failures and that is to be welcomed. But it’s time to move beyond sound bites and to start hearing how they intend to drive moral reform within their institutions."
Some sort of repentance, a changing of behaviour, was required argued Lord Myners:
"The banks need to understand that they have lost the trust of the public, and need to change their behaviours and values in order to earn forgiveness."
The speech can be downloaded from the Treasury website here.
I'm speaking on this theme at Labour Party Conference at a CSM seminar.
Stephen Beer, 20/09/2009