by Mark Goyder
Denial is in the air. First a leading figure in motors sport brands Flavio Briatore’s life ban as “excessive”. Then the director of the CBI’s UK Contractors’ Group says that the OFT’s fines for construction companies are “perverse and excessive” on the grounds that “cover pricing was endemic” and others were doing it.
And finally we have Lord Turner’s audience at the Mansion House complaining when he says that “not all financial innovation is valuable, not all trading activity plays a useful role, and a bigger financial system is not necessarily a better one.”
All three reactions symbolise inward looking, backward-looking business leaders who just don’t get it.
No industry can justify its existence solely on the grounds of its size and current or potential profitability.
Its licence to operate – and its long term success – depend on the value it adds to society, and the high ethical standards by which it operates.
All credit to Lord Turner for his forceful reassertion of this vital truth.
Instead of complaining how this will be perceived abroad, leaders in financial services need to communicate how and where its activities add most value, and to identify and control the areas where little or no value is added.