No Sir Fred Goodwin at last

We are fed up with the ‘unrepentant demeanour’ of Fred Goodwin and his ilk.
Fred Goodwin has now been stripped of his knighthood – At last, some
justice for Testosterone Fred
Fred Goodwin has now been stripped of his knighthood
Allison Pearson

The City bonus culture is the financial sector’s version of Mine’s
Bigger than Yours. No one in British banking was a bigger Willy Waver
than Sir Fred Goodwin. His unchecked ego led the then chief executive
of the Royal Bank of Scotland to purchase a diseased Dutch bank with
slightly less care than your average person would take to buy a
kettle. Testosterone Fred had to have ABN Amro; nothing and no one
could stop him getting his hands on a prize which was worth “a whole
load of nothing”, according to one horrified analyst.

The result was the worst financial disaster in British history; the
taxpayer had to prop up the bank to the tune of £45.5 billion. Some
tune; more like an unending funeral march. We will not know the exact
toll in human misery for years to come, but at least Fred Goodwin has
now been stripped of his knighthood – a humiliation described by one
wag as Sircumcision.

For the ultimate Willy Waver to be Sircumcised feels like poetic
justice, and long overdue, but protests began immediately that this
was “mob rule” and anti-business “hysteria”. The Government, critics
shrieked, had “bowed to public anger”. Shocking in a democracy to
accede to what most decent people believe is only fair and right,
isn’t it? If seeing a man lose a privileged title for his arrogant
folly is mob rule, then kindly pass this tricoteuse her knitting
needles.

Last week, I got a huge response when I asked nicely if it might be
possible to put a single banker in jail. Surely, amidst all the false
accounting, dodgy loans and downright lies to shareholders, one teensy
criminal act must have taken place? There was an indignant response
from financial executives, one of whom accused me of having a
“juvenile grasp” of economics. (Gee, that’s praise indeed coming from
a banker.) Everyone else bellowed: “Why only one?”

Quite simply, we are fed up of what the Financial Times calls the
“unrepentant demeanour” of Fred Goodwin and his ilk. We are fed up of
a bonus culture which says that senior people need “incentives” to do
million-pound jobs. This time last year, when the Barclays boss Bob
Diamond insisted that the “period of remorse and apology for banks”
needed to be over, many of us scratched our heads and wondered if we
had somehow missed the period of remorse and apology. Had it taken
place during an episode of Downton Abbey, perhaps, and we hadn’t
noticed?

It is entirely right to take away Fred Goodwin’s knighthood for
“services to banking” when banking has been done such a grotesque
disservice. There are many terrific, responsible men and women in the
financial sector who do a huge amount of philanthropic and charitable
work; their good names have been sullied by Testosterone Fred. The
honours system allows a title to be taken away if an individual is
censured by the regulatory body in the area for which they were
knighted. On Monday, Hector Sants, head of the Financial Services
Authority, told a Treasury committee that Fred Goodwin and other RBS
executives criticised in the FSA’s 2008 report are “not fit” to run a
bank and should never again work in regulated financial services. That
sounds a lot like censure to me.

Chancellor George Osborne said that Fred Goodwin and the fiasco at RBS
came “to symbolise everything that went wrong in the British economy
in the last decade”. So the Sircumcision has great symbolic force.
Symbols are important for a good society. Arrogant, reckless men
should not walk off into the sunset with a noble title and a £342,500
pension while the innocent suffer. Stephen Hester forgoing his bonus
is another step in the right direction. The overall bonus pot at RBS’s
investment arm, to be revealed before February 23, is expected to be
half the £950 million it was last year. The public – not the mob,
thank you – is entitled to ask whether a bank should be distributing
lottery-win bonuses to individuals whose jobs only exist because of
our cash.

The case for an inquiry into the behaviour of the financial services
industry, the auditors who didn’t audit, the regulators who didn’t
regulate and the Government which turned a blind eye in the run-up to
the crash is overwhelming. Changing nothing is not an option.

Helena Morrissey, the excellent chief executive of Newton Investment
Management who got a CBE in the New Year’s Honours List, founded the
30% Club to campaign for more women on UK boards, with a target of
women making up 30 per cent of FTSE 100 directors by the end of 2015.
At a recent event at RBS in London, Helena asked a huge roomful of
staff a question: “Who thinks the financial crisis might have been
averted if more women had been on boards?” Almost every person, male
or female, raised their hand in agreement.

Afterwards, Helena told me she had decided to go back and look at the
composition of the RBS board when Fred Goodwin was allowed to act like
a doberman on heat. “It was extraordinary,” she said, “I mean, you’d
expect them all to be white men of a certain age, but the astonishing
thing was that many of the board actually lived in the same Edinburgh
street as Fred Goodwin.”

The same street, dear reader. That was the chummy bunch of Scottish
chaps who looked after their own interests and wrecked ours. If Helena
Morrissey prevails, and I hope she does, then in future there will be
plenty of oestrogen to dilute the testosterone Freds. That’s the nice
thing about women. They don’t have willies to wave.
By Allison Pearson

9:30PM GMT 01 Feb 2012