The other day I met a woman just starting a career in banking in Spain, a country even more screwed by its banks than we are. She made the following statements:
The problem with banks is that they have bad people at the top.
We change the people at the top but it doesn’t change anything.
It seems impossible for good people to get to the top.
I pointed out there were some minor contradiction between the first and last of these and tried to suggest two things to her:
That the moral character of the person at the top might not make much difference to the actions of a bank.
That if it is only bad people getting to the top, there must be something wrong with their structure.
She admitted there might be something in the second but would not countenance the first. She was going into banking with good intentions, she said. She would not do bad things.
5 thoughts on “The Good Banker”
I agree with you, but would add to your two theses: That the strong hierarchical structures of banks (and for that matter, many other organisations) turn sincere ‘good people’ who get to the top into ‘bad people’, particularly if the goals of the organisation (e.g. maximising profit) are well-served by ‘bad’ strategies which also boost the status of people at the top (e.g. risky actions which pay off on the short-term).
Of course, my thesis does not sit comfortably with your first thesis, which argues against blaming the people at the top for the actions of banks. I think where our theses perhaps can be brought together is by proposing that the dominant culture/ethos in any organisation affects its actions, and often the people at the top (at a particular extended moment in time) have a disproportionate influence over the formation of this (constantly evolving) ethos.
I think I prefer your thesis to my first one – as long as we rather say the structures turn ‘people who do good acts’ into ‘people who do bad acts’. If we phrase it in this way I think my first thesis becomes irrelevant. Rather than worry about a nebulous ‘moral character’ we can judge people on their acts. But your second point is good too – people at the top can influence the ethos of an org and the ethos can influence people. It definitely goes both ways.
Perhaps it is the case that the organisation of a bank is such that some acts result in more money profit for the bank than others. Within some margin of error, people who engage in acts that are more monetarily profitable are more likely to become in charge of the bank?
And perhaps it is the case that acts which are more monetarily profitable may also likely to be more socially harmful?
I think the moral character of the person is irrelevant; is is simply sufficient that a person exists that is willing and able to engage in a particular act and that the organisation prevents interference with that act by other parties.
Having said we should think about it in terms of ‘acts’, I was thinking about it again last night and it occurred to me that if an organisation has positions in which having little in the way of a conscience (for want of a better word) is an advantage, there will always be a certain percentage of people with low-functioning consciences who will move to fill those positions. Perhaps, in other words, we shouldn’t break it down into particular acts but into certain ‘behavioural tendencies’ that will be favoured.
As for doing things differently, I don’t think you can get rid of people with low-functioning consciences so presumably we should try to design structures where they cannot get into positions of power, or don’t stay there long.