Banking StandardsWritten evidence from Lord Phillips of Sudbury OBE, Sir John Banham DL, Tim Melville-Ross CBE and Sir Stephen O’Brien CBE
Restoring Public Trust in Britain’s Banks and Major Businesses
For the last 18 months a small group convened by Andrew Phillips (Lord Phillips of Sudbury) has been considering the steps that need to be taken to restore public trust in the integrity of Britain’s banks and major businesses. Originally set up in the immediate aftermath of the occupation of St Paul’s churchyard, the group—Lord Phillips, Sir John Banham, Tim Melville-Ross and Sir Stephen O’Brien (see end)—have watched aghast as the “licence to operate” of some of the most important businesses in Britain has been called into question by a series of public scandals that threaten to do massive damage both to an economy already struggling to cope with the global financial crisis and the problems of the euro-zone and to the society it serves.
Of course, we are all too well aware that we are a self-selected quartet answerable to no one. However, we are also aware that the general public is looking for answers to the central question: can anything useful be done to moderate the insatiable and anti-social greed that seems to infect society at large? The extent of the challenge has been brought into sharper focus since the Commission was established by the LIBOR scandal. Even as their paper is being written we learn of the developments at Eurasian National Resources Corporation (see later) and the implications for Western clothes retailers of the tragedy in Dhaka.
Our experience of leading major organisations over more than two decades (see the tailpiece) suggests that the answer to this question must be “Yes!” Our conviction has been reinforced by conversations with a number of very senior figures in the City, many of whom are understandably reluctant to say in public what they really believe about the prevailing value-system. What are sure of is that reform cannot be imposed from the top by Codes of Corporate Governance, let alone by more regulation. Most of the corporations that were associated with the financial crisis were highly regarded by the corporate governance commentators. In any case, rampant materialism is not confined to big business and the City of London as anyone familiar with the local planning system will recognise. Society already altered.
Yet, our combined experience shows that outstanding returns for shareholders can be delivered by large businesses that take their corporate social responsibilities seriously and have created and preserved a sustainable corporate culture in face of the markets’ pressure for short-term results and rising dividends. We have drawn on this experience of what works to prepare this memorandum for the Commission, fully aware of the dangers of seeming to be self-serving—the most expensive words in British public life are said to be: “I told you so!”. The first part sets out the summary background to our thinking; the way forward sets out seven ideas for action by individual businesses to restore the public trust in Britain’s banks which is an essential pre-condition of economic growth.
Background
If ever big business enjoyed broad public trust in Britain, it seems recently to have lost it.
This loss of trust has happened against a background where many of the major institutions that make up our society—Parliament, the Churches, the media, the police have seen a similar erosion of trust and respect by the general public. But there are some special factors at work for business:
An increasing, and seemingly vain, focus on short-term financial gains for investors- most of whom would have been better served with their savings under their mattress than invested in the UK equity markets over the last decade;
Some extraordinarily ill-judged financial remuneration packages which do not seem to reflect executives’ performance in creating value for those who ultimately own the business—the shareholders. In the case of the financial sector, the direct and indirect costs of excessive remuneration have contributed to the crisis which continues to impose such heavy burdens on society at large.
These two factors particularly have in turn led to general debate focussing on the limited values underpinning the governance of many organisations in the public and private sectors. The US Journal of Public Affairs recently (Volume 10, pages 121–138) published a paper introducing the concept of the corporate psychopath—ruthless , selfish and conscience-free individuals in senior management positions who pose important challenges for companies and their boards.
Corporate Social Responsibility (CSR), as a concept and system, began as a way of earning and retaining civic respect and public recognition that business was an integral part of society at large and the communities in which individual businesses operate. It saw itself as a change agent, to create a more socially engaged, prosperous society and integrated community.
However, the CSR “movement” has developed into literally hundreds of separate initiatives with little co-ordination; and the effectiveness of the UK corporate governance “industry” must be called in question by recent events: as was stated earlier, all the UK’s banks and largest companies met all the requirements of the various codes of corporate governance practice—indeed, it can often seem that the more good practice “boxes” that are “ticked”, the more shareholder value seems to have been destroyed. BP is a prime example. In any case , the general public seems unconvinced. According to the Institute of Business Ethics, some 42% of the public does not believe that the British business sector behaves ethically; and typically less than a third of those questioned say that they trust business leaders to tell the truth. [The Times, 13 August 2012]
The current so-called crisis of capitalism , and the recent riots in Britain, France, Greece and Spain, have emphasised that business is not creating sufficient jobs to support a secure democratic system. With unemployment among young people in Spain approaching 50%, and no end in sight to the era of austerity, it is small wonder that the outlook for the newly-elected Spanish government and democracy in Spain itself is guarded at best.
The success of the London Olympics and continuing falls in crime rates [The Economist 20 April 2013] should not blind anyone to the uncomfortable facts that cuts in UK public spending have not yet fully begun to “bite” and total UK indebtedness remains significantly higher as a percentage of GDP than in Italy, Spain or Greece, because of bank debt. The worst of all outcomes would be if, after all the sound and fury, nothing much changes: “The dogs bark; but the caravan moves on.”
A culture where private, public and social enterprises really worked together with shared values and an overlapping agenda—rather than in a climate of mutual blame and distrust between business, the public and politics—could make a huge difference in current circumstances. Blaming the sensationalism of the discredited media would be a totally inadequate and escapist response to the current crisis of public trust in the integrity of our banks and major financial institutions. So what specific steps can and should be taken by the leaders of every major business in Britain and the boards of Britain’s banks in particular? This is the subject of the next section of this memorandum.
Ways Forward for Business
Rebuilding public trust and confidence in the City will be essential to creating jobs and growth in an era of austerity. Unfortunately, too often, suggestions to this end amount to little more than bland generalisations reminiscent of the old definition of a British diplomat: “generally speaking, he was generally speaking”. This group has drawn on their individual personal experiences, of the public and private and voluntary sectors , to recommend seven steps for Banks and other City institutions to take, namely:
1.
2.
3.
4.
5.
6.
7.
If these ideas commend themselves to the Commission, it will be necessary to identify an existing organisation to take ownership of them—assuming responsibility for publicising and promoting them as widely as possible. We do not underestimate the difficulties involved; leading membership organisations criticising their own members is not a recipe for a quiet life or long tenure. But these are extraordinary times; and the cost of failing to restore public trust in Britain’s banks will continue to be unacceptably high.
The rest of this memorandum describes each of these steps in turn.
1. Corporate Governance
Tempting as it is for commentators to blame ineffective regulation, external auditors in the pockets of executive management and professional advisers with conflicts of interest for the problems that have afflicted Britain’s banks and other major companies (such as BAE Systems, BP and Shell) on whom pensioners have relied for their retirement income, these problems are all the result of failures of corporate governance. The various Codes of Good Corporate Governance Practice may have been necessary. But they have been shown not to be sufficient to prevent the catastrophes from which the economies of the developed world are struggling to recover: Barclays, along with every other UK High Street Bank, met all the requirements of the various codes governing the composition of their boards of directors and their corporate approach to risk management.
There is an obvious danger in undue reliance on quotas that have been negotiated by the various special interests involved: quotas are judgement free—either a board has the “right” proportion of independent directors (or women) or it does not; and the corporate governance industry can react accordingly. But what matters is the effectiveness of boards of directors, not whether(or not) some quota in their make-up has been met. For example, the widely welcomed appointment of Sir David Walker as Chairman of Barclays was totally incompatible with existing corporate governance rules.]
This issue was confronted by the RSA Tomorrow’s Investor project. One of the project’s publications, “Securing Decent Returns for Investors in Troubled Times”, advised all investors and their fund managers (inter alia) to satisfy themselves that the Chairman and independent directors of “their” companies had the combination of competence , courage and commitment to call management effectively to account? Are they in a position to insist on satisfactory answers to difficult questions, like those associated with trade with Iran or corporate tax avoidance schemes? Will they be prepared to resign if they are not satisfied that the business is being run in the interests of all the stakeholders rather than management? The best independent directors are those who can devote the necessary time, have reputations to lose and who can afford to resign when they do not like what they see and hear.
The character of independent directors is far more important than their quantity. After all, independence is a state of mind rather than some career-derivative; and a willingness to express an independent point of view in face of a board and senior management consensus requires an unusual combination of moral courage and well-founded self-confidence based on experience .In our experience such independence is especially valuable when major acquisitions are under consideration. There is long-standing evidence that most takeovers destroy value for the shareholders of the acquiring company. Nonetheless, “giantism”—the management and shareholder urge to expand a business regardless of the risks involved—can be difficult to resist, as the shareholders of RBS and Lloyds TSB know to their cost.
Our experience suggests there is much to be said for relatively small (7–9) boards of directors, predominantly made up of properly remunerated independent directors with executive representation limited to the Chief Executive (CEO) and perhaps the Chief Financial Officer. Too often in the past,the boards of Britain’s banks have been too large to be effective. There have been too many “serial” non-executives unable to devote sufficient time to understand a complex business; while executive directors are very rarely, if ever, prepared to challenge their CEO in board discussions of key issues.
2. Mission Statements
At the heart of every successful business is a corporate culture that reinforces and informs the company’s strategy. Put less positively, many of the problems that caused the financial crisis have been attributed to “the wrong culture” within the business.
In today’s mobile employment world ,where people move from firm to firm much more frequently, every business needs a clear statement of its mission and core values or culture: “the way we do things and what matters around here”. Too often these statements seem to have done little to establish trust in the business itself. The statements are often left in limbo; and a single act of “bad behaviour” can easily negate decades of hard work. The solution lies in firm implementation by Boards of Directors of agreed and published values which are enforced world-wide, and subject to regular external audit to ensure that, at all levels in the organisation, everyone is aware of the mission and values and pays more than lip-service to them.
Most long-term shareholders do not believe that a company should sacrifice ethical considerations to increase short-term profitability; in fact , many invest in successful global businesses precisely because they have confidence in the management to invest wisely for the longer term—increasing capital and R&D spending in difficult times , in an effort to “never waste a good crisis”. As with any initiative, the process of developing a mission statement needs to involve as wide a cross-section as possible of the people whose support will be essential to its effectiveness in influencing individuals’ behaviour.
The notion of “fairness” needs to be at the heart of any corporate mission statement. This is not as vague or as impossible as it sounds. Treating customers fairly is now a core Financial Conduct Authority principle. But, long before the regulators acknowledged the importance of the concept, Nationwide was using it as a guide to management action at a time when many of their competitors were giving way to pressures from their members looking for an allocation of free shares to convert to publicly-quoted banks—abandoning the mutual ownership structure, with disastrous consequences for the Building Society movement in general and Bradford & Bingley, Cheltenham and Gloucester and Halifax in particular.
3. Code of Conduct
Many studies have shown that the general public is not particularly interested in financial matters and devotes little time and effort to planning for their families’ financial future. As a consequence, a disturbingly high percentage of households are failing to save enough for their retirement. This lack of preparedness is compounded by the widespread distrust of financial institutions fuelled by recent examples of aggressive mis-selling of pensions and complex financial products to customers who did not understand the risks they were taking on, and were not well placed to assess the balance between the risks and the rewards they were being offered.
Every company in the financial services industry needs a Code of Conduct, binding on all executives and staff, that specifies that the interests of the client comes first at all times—ahead of those of the company or its owners. Indeed, the only way to prosper in today’s litigious world is to have a well-founded reputation for putting the clients’ interests first. Failure to live by the Code of Conduct should bring serious consequences, in terms of compensation and career prospects; and Audit Committees should routinely satisfy themselves that the Code of Conduct is both signed up to and understood by all new employees and reflected in compensation and career decisions.
The way that the global fund management industry works is often cited as one of the underlying causes of the financial crisis, because of the mismatch between the interests of the agent ( the fund manager) and the principal (their clients). The former can feel compelled to operate to a very short time horizon, often driven by market , media and even political considerations; and there are often quarterly reports to trustees, where their performance will be scrutinised. Meanwhile, pension funds and financial institutions operate to much longer time horizons, with liabilities measured in decades.
In such circumstances, it is especially important that everyone within the fund management organisation knows that their first obligation is to safeguard the clients’ interests, even if this means that there is a risk of losing the account by “doing the right thing”.
The imperative to put clients’ interests first was recognised by the Board and new senior management team of Invesco, now one of the largest and most successful independent fund managers in the World, when the company was struggling with serious regulatory problems in the US six years ago. As a result, new management was brought in. A new mission statement and set of strategic priorities and approach to risk management put clients’ interests first and the Code of Conduct was revamped. Invesco’s Code of Conduct and the business strategy that follows from it is accessible for clients and employees alike on the Company’s website, Invesco.com.
4. A Fair Approach to Compensation
There can be no doubt that the compensation practices of the financial services industry have been the single most important source of public concern at the way major financial institutions are managed. The annual bonus “campaigns” of City employees are perceived to have encouraged, if they did not cause, the risk-taking that has caused so much damage to the wider economy; while the resulting differentials in reward are widely seen as unacceptable.
Excessive executive compensation also fails the fairness test. It can also mean that investment in the future of the business and in risk management are sacrificed to meet compensation demands that are often dressed up by an industry of compensation consultants as “the market rate for the job”. While clients’ interests are inevitably disadvantaged by high staff turnover, as executives leave to secure higher bonuses at another firm, they are not held to account for their decisions and advice. Excessive staff turnover also makes it far more difficult to build and sustain the kind of corporate culture which is widely seen as the key to the long-term success of any business or enterprise. Finally, shareholders suffer from the lower profits and dividends resulting from excessive compensation and the higher capital requirements imposed by financial regulators to offset the perceived risks in the business.
Plainly, it must be for Parliament to ensure that the personal tax structure both reflects the prevailing political consensus on acceptable levels of pay differentials and is effectively policed. Moreover, EU attempts to legislate lower bonuses as a proportion of basic salaries seem likely to have the unintended consequence of inflating salaries and thus fixed costs—with no discernible impact on individuals’ overall remuneration.
So far as corporations are concerned, the best way to secure shareholder support for their compensation policies and practices is greater transparency—there are very few conditions where more “sunlight” is not beneficial.
The Shareholder Spring came a year earlier in the United States than it did in Britain and delivered a timely wake-up call to many boards of directors: despite what was generally seen as a robust and prudent process, to align executive compensation with financial and strategic performance, and regular endorsement by UK shareholders when the company was quoted in London (as Amvescap) over 40% of Invesco shareholders voted against the Board’s recommendation in the advisory vote on executive compensation at the 2011 Annual Meeting.
The Company responded to this vote by engaging with its principal shareholders and greatly increasing the levels of disclosure of the compensation decisions for individual senior managers. The proxy materials circulated to shareholders ahead of the 2012 Annual Meeting ran to 23 pages and explained the company’s compensation philosophy and practices in considerable detail. In view of the Banking Commission’s interest in remuneration within financial services companies, it is perhaps worth summarising Invesco’s approach:
Base salaries of senior managers comprise only around 10% of their total annual compensation, including pension contributions, because of the strong emphasis on pay for performance in delivering results for clients and the use of deferred compensation;
The company’s total incentive compensation is linked directly to a narrow range (below 50%) of pre-cash bonus operating income, thus meeting the “fairness” test: incentive compensation is only paid when the company is generating operating income;
Compensation of senior executive management is heavily weighted (60–70%) to deferred compensation, paid in the form of shares that vest over a period of four years. A significant portion of the deferred compensation is tied to Invesco’s financial performance—specified levels of operating margin and diluted earnings per share—and is thus aligned with the interests of shareholders;
A “clawback” policy is applicable to executives’ performance-based long-term equity awards, permitting the Company to recover compensation based on fraudulent or wilful misconduct;
An insider trading policy prohibits short-selling, dealing in publicly-traded options and hedging or monetization transactions in the Company’s common shares;
The various equity incentive plans prohibit re-pricing of options without the express approval of the shareholders at the Annual Meeting.
Despite strong financial results in 2011 and substantial strategic progress during the year, including the successful integration of a significant acquisition, incentive pools and the incentive compensation of senior managers was maintained at the same level as in the prior year; salaries of senior executives were maintained at substantially the same levels as have been in place since 2007. All senior Invesco executives make their own pension arrangements; there is no equivalent of the UK “Top Hat” executive pension plans which have caused such reputational damage to British business, as “pay-offs for failure”.
The contrast with the pay policies and practices in the City of London speaks for itself.
The reaction of shareholders to these decisions and the enhanced transparency was overwhelmingly positive. At the 2012 Annual Meeting, in a record poll, 96% of the votes by Invesco shareholders approved the Say-on-Pay proposal. Current indications suggest that shareholder opinion will be similarly supportive in the 2013 vote.
We need to add a reservation to the forgoing. If it should prove that such a reformed approach by UK public companies is not voluntarily adopted, Government will be forced to act, for the antisocial consequences of the present culture are unsustainable.
5. Whistle-blowing
It has long been recognised that wrong-doing in any organisation is very rarely uncovered by external auditors. Hence the importance of effective risk management policies and procedures , backed up by internal audit arrangements that are equal to the complexities of the business and the scale of the risks for shareholders.
But even these arrangements are not guaranteed to work. They have, self-evidently, failed to prevent rogue traders costing shareholders £billions and great institutions like Barings and the NatWest their independence. The implications of the LIBOR scandal are potentially very serious indeed for the banking system as a whole—particularly once the US Plaintiff’s Bar becomes involved. In each case, the immediate perpetrators could not have been the only people to know what was happening. But those “in the know” chose to remain silent, either because they were not aware of the existence of whistle-blowing machinery, or because they did not see it as their responsibility to use it or because they did not trust the system to protect them and take their concerns seriously. The result has been huge damage to the economy at large and to the trust in business’ ethics by the general public.
Market manipulation and insider trading are crimes. So are undisclosed payments to local councillors for obtaining planning permission in the area they represent. Yet successful prosecutions for these crimes in Britain are very rare, further reducing the incentive for would-be whistle-blowers to incur the often acute personal risks involved. Especially damaging to public confidence in the NHS and planning system has been the systematic failure by the bureaucracies involved to take whistleblowers’ concerns seriously.
The prosecutorial authorities need much stronger resourcing so as to make such financial crimes a real risk to their perpetrators rather than the merely theoretical threat they now are. Legislation protecting whistle-blowers from retaliation or victimisation by employers has been on the UK Statute Book, ever since enactment of the Public Interest Disclosure Act 1998. Effective whistle-blowing machinery should be seen as the last line of defence for the public and shareholders. The forthcoming findings of the Whistleblowing Commission established by Public Concern at Work, should be heeded by the Government.
Every company should install some form of well publicised whistle-blowing telephone hotline, enabling employees and individuals outside the company (customers or suppliers, for example) to make anonymous complaints or register concerns regarding compliance with applicable laws, rules or regulations and the Code of Conduct as well as accounting, auditing and ethical concerns. The US Foreign Corrupt Trade Practices Act and its recently enacted UK counterpart make such machinery particularly important for any global company.
Calls to telephone hotlines should be monitored at least every week and reported to the independent chair of the Audit Committee, who can decide on the necessary action—including initiating an independent investigation of any particularly serious allegations.It goes without saying that the person over-seeing the system should be completely independent of management and seen to be so.
6. Individual Accountability
The concept of personal accountability for results lies at the heart of any successful enterprise. If individuals are not to be held to account for their performance, it is difficult (if not impossible) for Boards (or Governments) to delegate authority without abdicating their overall responsibilities for effective governance of the business or institution; and there will be even further reliance on regulation to avoid the mistakes of the recent past. Public confidence in business is not enhanced by the realisation that very few senior people have paid any price for presiding over catastrophic misjudgements and worse which have cost millions of families dearly.
The case of Eurasian National Resources Corporation (ENRC) offers a stark illustration of the cost of greed in the City to thousands of UK pensioners. It was quite apparent when the possibility of ENRC securing a London quote for less than 20% of its shares was under consideration in 2007 that this would not be an appropriate investment for UK pension funds. Yet the flotation went ahead, earning the City institutions concerned fees well in excess of £150 million according to recent press reports. As a constituent of the FTSE 100 index most UK pension funds were required to hold the shares; and by the beginning of May 2008, when many UK pension funds had joined the register, ENRC shares were trading at £13.15p.
However, by late April 2013 ENRC shares had fallen nearly 80% to 270p; and The Times (27 April) was reporting that Macquarie was telling clients to “get out now, while you still can” and the Serious Fraud Office had decided to open a criminal inquiry into suspected fraud at the company. The total loss incurred by UK investors will eventually be over £1 billion as a direct result of the decision by City institutions to support the original ENRC public share offering.Yet no individuals and no advisers or financial institutions have so far been called to account for this entirely foreseeable loss. There seems to be a conspiracy of silence when there should be accountability and recompense for the losses incurred.
The problem does not seem to be confined to the private sector. For example: accusations against the leadership of the NHS, which would usually result in charges of corporate manslaughter against any private sector employer, have (so far) resulted in no-one being called to account for the situation at the Mid-Staffordshire Hospital Trust that has caused such public concern and outrage.
Individual accountability for performance would be strengthened by the following steps:
(a)
(b)
(c)
In each case, the combination of foot-dragging until public anger cools and what seems like a conspiracy of silence has left some awkward questions to be answered, beyond blaming “light-touch” regulation: why did the Boards of directors, their highly paid managers, their auditors and other professional advisers all fail to prevent catastrophe? Where were the whistle-blowers and how were they treated? Where, in the words of the Chairman of the US House of Representatives opening the public hearings into the failure of Lehman Brothers less than a month after the event, was common sense?
(d)
(e)
Individual accountability is central to the effectiveness of any large organisation. “Where everyone is responsible, no-one is responsible”. Too often, managements in both the public and private sectors, seem to be more concerned with avoiding individual responsibility for results, syndicating risks (and the possibility of blame) rather than managing them effectively.
7. Corporate Social Responsibility
Finally, every major City firm needs to determine its attitude to Corporate Social Responsibility. In today’s fevered environment this will be far more challenging than was the case with sustainability, where a little “greenwash” went a long way. With the general public suffering the after-effects of the excesses of the pre-crisis era, there is a widespread perception that compensation in the City is generally still excessive and out of line with performance in creating shareholder value. The City needs to demonstrate that it is about more than self-interest and that it is an important part of the solution to some of the most pressing problems facing the Nation. As the new Chief Executive of Barclays is recently reported (Financial Times, 11 May) to have put it in a recent BBC documentary:
“We have to be realistic that rebuilding trust in the banking industry is going to take a long time. It’s the responsibility of Barclays to change perceptions through what we do” [emphasis added]
For example, the current housing crisis provides a massive opportunity for the City both to help address a problem that impacts millions of households in virtually every community in Britain and to spur economic growth—for at least a decade, Britain has been under-investing in residential housing compared with France and Germany to the tune of at least two percentage points of GDP or some £30 billion a year. With a multiplier of 2.8x, this means lost economic output of over 5% of UK GDP (sic) or the difference between recession and healthy growth in output and jobs.
As a result, there are over two million families on housing waiting lists; and Housing Benefit is costing over £20 billion a year, or over £1,000 for every household in Britain.The RIBA Future Homes Commission has concluded that for the next two decades, the number of new homes built every year needs to treble, to around 300,000.
The Commission, whose report “Building the Homes and Communities Britain Needs” has been widely welcomed by the various stakeholder groups, shows that the increase can be funded without a cent of additional public spending, by a combination of UK pension funds and financial institutions. Unfortunately, the fragmented UK pension fund industry is under-exposed to property and particularly to residential property—less than 1% of a typical UK pension fund property portfolio is invested in the residential sector, compared to around 20% elsewhere in Northern Europe and over 25% in the US.
The current structure of local authority pension funds (there are over 100) is particularly damaging; it could have been designed to encourage individual funds to invest anywhere except in their own localities. Yet, if the largest 15 funds were each to contribute (say) 15% of their assets to an independently managed £10 billion Local Development Fund the result would be an enormously powerful engine for economic growth—and a wonderful example of the City and local Government at work in the public interest.
The £180 billion of Local Authority Pension Fund assets were recently described as having been “in a state of suspended animation” for the last two years, an appalling commentary on those responsible. If the City could demonstrate that it is simultaneously able to secure better returns for local authority pension funds and finance the trebling of home-building in the right places, the reputation of the financial services industry would be transformed; and Corporate Social Responsibility would begin to realise its initial promise.
Tailpiece
If the above seven steps were implemented by every major City institution and big company it would help to restore public trust in their integrity, a trust that is a vital pre-condition of sustainable economic growth hand in hand with social responsibility. Our combined experience convinces us that these are not unrealistic expectations. On the contrary, they already characterise many good businesses in Britain today. What is now needed, urgently, is for best practice to become common practice.
14 May 2013
The Backgrounds are Summarised Below
Andrew Phillips (Lord Phillips of Sudbury OBE) a practising solicitor for over 50 years, set up Bates Wells & Braithwaite, London in 1970, where he is still a consultant. He has specialised inter alia in the charity sector and helped set up a number of socially innovative charities in the business domain including the Charity Bank, Public Concern at Work, Business in the Community, the Fairtrade Foundation and The Citizenship Foundation, which he founded. For 24 years he was the “Legal Eagle” on the BBC Radio 2 Jimmy Young show. He is Chancellor of the University of Essex. He was made a Life Peer in 1998.
Sir John Banham, DL was the first Controller of the Audit Commission (1983–87) and Director- General of the Confederation of British Industry from 1987–92. Since returning to the private sector, he has successively chaired four FTSE 100 Companies which all earned exceptional returns for shareholders during his tenure while taking corporate social responsibility seriously: Tarmac, Kingfisher, Whitbread and Johnson Matthey. He is currently an independent director of Invesco , where he chairs the Compensation Committee. He chaired the RSA “Tomorrow’s Investor” project and is the Chairman of the RIBA Future Homes Commission.
Tim Melville-Ross, CBE worked at the Nationwide Building Society for 20 years from 1974, becoming Chief Executive in 1985. He was Director-General of the Institute of Directors from 1994–99. Since leaving the IOD he has chaired a number of public and private sector organisations including Investors in People and Bovis Homes plc. He is currently chairman of Royal London Insurance, the Higher Education Funding Council for England and the Homerton University Hospital NHS Trust.
Sir Stephen O’Brien, CBE spent 16 years in the City, where he was Chairman of Charles Fulton (International Money Brokers) and served as Chairman of the Foreign Exchange and Currency Deposit Brokers Association from 1968–71. He was the first Chief Executive of Business in the Community and served from 1983–92. He then went on to be the founding Chief Executive (later Chairman) of London First from 1992–2005. He was the founding co-chairman of Teach First from 2002–09. He is currently Chairman of St Bartholemew’s (Barts) Health, having been Chairman of the Barts and Royal London NHS Trust from 2010–12.