DAVID CHARTERS: Stephen Hester deserves to be knighted
I don’t know about you, but to me there’s a nice ring to Mister Fred Goodwin. If that sounds petty, I should explain that I used to have a lot of friends at RBS. Now I only have a few. Most of the others have landed (eventually) elsewhere.
The issue of stripping bankers – or anyone – of honours is a difficult one, at least if we want to have any claim on consistency and fairness. Much easier is getting the award of an honour right in the first place.
Honouring bankers is hardly going to be top of anyone’s list of priorities right now. And yet there are people out there who definitely deserve recognition.
Stephen Hester would be top of my list. He took on a job that matters to every taxpayer in the country. It’s a job which is immensely challenging, and from which one day I believe we will all profit handsomely.
Yet in the meantime his reward is, well, not to be rewarded, at least by the standards of what someone of his seniority and experience could expect pretty much anywhere else in the industry. Work hard, Stephen, turn the supertanker around, oversee a profitable exit for the taxpayer, and perhaps Ed Miliband will eventually accept that you should be paid something approaching an industry norm – although don’t expect your pay to be in Bob Diamond’s league, even though there is no norm for what we expect you to do.
Where I struggle is when I see senior bankers being honoured more or less routinely just for being senior bankers. I feel the same way about Premiership footballers or movie stars, although at least their talent is somewhat rarer.
Routine custodianship of a large institution, earning handsome annual payouts and living a comfortable lifestyle, hardly seems sufficiently exceptional to merit an honour, at least if we think honours should mean something.
Creating value is different. Build a business aggressively and successfully, creating something substantial and permanent, taking risks and determining strategy, certainly merits an award of some kind. I can see why Fred Goodwin was an obvious candidate – I just wish the Honours Committee had waited a little longer.
Giving back to society, whether of oneself through public service or of what you have accumulated during your career, certainly merits some kind of recognition, albeit that recognition is rarely what provides the motivation. Anyone who commits to the frantic and all consuming task of serving as Lord Mayor certainly gets my vote.
But party donors don’t. In fact until this country gets properly (state) funded political parties independent of outside donors for their financial viability, I would automatically exclude party donors unless they could point to truly overwhelming evidence of achievement and contribution in other fields.
A lot of people would say that being a banker is reward enough for anyone in these hard times. Having gone to the brink, we have been pulled back and saved by the taxpayer. By the standards of most of industry we are still incredibly well paid.
So if we want recognition we should show we deserve it – by our actions rather than the positions we hold.
David Charters is a partner at advisory firm Partner Capital. He was formerly head of equity syndicate at Warburg and Deutsche in London.
