Posted tagged ‘banking’

No exchange

October 8, 2012

It’s probably a good thing that the UK did not join the Euro, given what has happened to the latter currency and its uncertain future. For all that, it is the currency of Britain’s key trading partners, and must be what any bureau de change trades in most. Or so you’d think.

Today I needed to give €60 to someone who is about to travel from Scotland to a country in the Euro zone. Easy, I thought. I’d go into the nearest bank and hand over some £50 or so and get the necessary banknotes. Job done.

Not a bit! In the first bank, a very nice lady at the counter looked simply stunned when I asked her for the currency. This was a request that had clearly never crossed her desk before. She was most solicitous, but this didn’t extend to having any solution. She absolutely couldn’t imagine how a bank would change Pounds for Euros. The whole concept was new to her. She would definitely look into this, totally, but only when her manager returned. I started to ask when that would be, but realised this was a waste of time and moved on.

Into the second bank, just across the road. Yes, the nice man behind the counter had definitely heard of Euros, and was absolutely willing to believe the transaction could be done. He had no idea how, but there was a supervisor somewhere who, he assured me, understood even the most obscure banking transactions and would help me, no doubt about it at all. So off he went looking for the supervisor. He returned, some ten minutes later, with the very keen supervisor, who was clearly willing to expand his horizons. Yes absolutely, Euros could be provided. First, was I a customer? Of course, I said, I’m here and am ready to do business, in other words a customer. I wasn’t a regulator, if that’s what he meant. No, no – did I have an account in this branch? No; in this bank, yes, but not this branch. Pursed lips, whistling noises, furrowed brows. Could I prove I was an account holder in that other branch? I could. OK then, he was willing to take on the Euro adventure, just this once.

So how much did I want? €60. More pursed lips and quiet whistling noises. No can do €60. €100, probably; €200, definitely. But alas, no €60. Well, I’ll be in Ireland again before long, so I can accept the €100. Off he goes on a search for this bit of currency. Another 10 minutes of my life lost. Triumphant return, clasping a sealed envelope said to contain the elusive currency; though for some reason, I mustn’t open the envelope there and then, which I was about to do, feeling the need to check it out.

Well, half an afternoon later I am able to give my friend the €60. But for goodness sake, does this really have to be so difficult? Do we really never change currency any more? It is true that I don’t, normally; I just use an ATM at my destination. But there must be others who, occasionally, need to get some foreign exchange before they travel, or to give or send to someone. Was I really making such an exotic request?


Searching for higher standards of ethics: a real quest, or a wild goose chase?

December 22, 2010

In 1972 I completed my secondary schooling in Germany. As some readers may know, the final German school examination is the Abitur, and this has a written and an oral component. For the oral Abitur (at least in those days), students could be tested in a small selection of subjects in which they had either excelled during their studies and written exams, or in which their status might be doubtful. I was orally examined in Physics and Philosophy. In the Philosophy section, the examiners (and there were 25 of them in the room) focused on ethics, and I believe I did rather well.

Two years later I was in another exam. This time I had just completed a training programme as a German banker, and this too ended with a written and an oral examination. In the oral exam (and again there were over 20 examiners, all of them established bankers) I was asked this and that: about letters of credit, principles of monetary policy, central banking controls – and then, perhaps as an afterthought, the chair of the panel asked me what I thought about the ethics of the banking sector. Oh good, I thought, I can pick up where I left off two years ago, and I launched into a quick oral treatise on Aristotle right up to Habermas. But I had not been talking for more than 45 seconds when I was interrupted by the chair with this: ‘I was not intending you to talk about philosophy, but rather I wanted you to say something practical’. Well, I thought I was about to say a few very practical things, but I sensed the mood, smiled politely and just stopped. I passed my exam with flying colours, but my report noted in passing that ‘he has a possible tendency to theorise’, not meant as a compliment, I think.

Exactly ten years later, in 1984, I was a lecturer in the School of Business Studies in Trinity College Dublin. My then Head of Department, Professor Charles McCarthy, was keen to explore whether we might establish a senior post in business ethics, and called a meeting of some staff of the School and a small number of prominent Irish businessmen (and they were just men). The consensus offered by the businessmen was that (as one of them actually said) ‘ethics has no relevance for business’. I avoided my little lecture on Aristotle and Habermas.

A quarter century on again, and we have come some distance from those perspectives. Many financial and business scandals later, and with some offenders against codes of ethics pondering these matters in prison, nobody would seriously argue that ethics and business are unrelated. But despite that, business ethics as a framework for analysing business decisions and practices is not yet very far advanced. In the minds of the general public, it is probably largely about dealing with and preventing serious corruption such as bribery and fraud; some businesspeople may regard it as being about avoiding regulatory problems. But while these are indeed significant, the real issues we need to address are more subtle, and are not easily summarised in a ‘thou-shalt-not’ code. They include an analysis of the philosophy of business, and of corporate social responsibility.

As we face up to the reality of some serious misjudgements, and indeed some serious wrongdoing, in various business and financial circles, we have to see that we don’t solve these problems by throwing a few people in jail while we wait for the next generation to do more or less exactly the same thing. We need to develop a much better understanding of what ethics is really about, why it matters, and what we must do to entrench a code of ethics in both private and public conduct. This is something much more complex than condemning or jailing those whom we once admired but about whom we are now embarrassed. Prison is no more likely to make better people of these guys than it does of any petty criminal.

Universities have a vital role to play here. I cannot help feeling that every undergraduate student, no matter what they are studying, should be doing a module on ethics; and we should have much more sophisticated public discussions on ethical issues, perhaps led by some academic experts. It is time to get practical about ethics.

Vox pop

October 20, 2009

Over the last three days I overheard two things that, in different ways, seemed to tell something about the times we’re in. The common element is banking.

First, overheard on Grafton Street, Dublin – teenager begging at the side of the road with the shout: ‘Any spare change for NAMA?’ [On second thoughts, maybe he really was collecting for NAMA…]

The second occasion was in a London cafe, where two middle aged ladies were in conversation as follows:

‘Do you remember our French neighbour, Monsieur Chouin?’
‘Yes, indeed.’
‘Do you remember I told you he had voted for the BNP [British National Party, see my previous post] at the European elections?’
‘Yes, terrible.’
‘Yesterday he told me it was all a big mistake, he thought it means “Banque Nationale de Paris”.’

Leaving aside the total weirdness of that exchange, I could not help wondering what would now be considered the lesser evil at the ballot box, a banker or a right wing extremist. I’d say it would be a close call.

Power and protest

April 1, 2009

Right now, the leaders of 20 powerful nations have assembled in London, and tomorrow we shall see whether they will reach an agreement – modelled, if so, largely on President Obama’s framework for economic recovery – or whether they will miss an opportunity to chart a way out of recession. At the same time, others have gathered in London to protest at this and that. I am not referring to Angela Merkel and Nicloas Sarkozy, who have come as close as can be imagined to having their own alternative summit in the same place; I am talking about anti-capitalist protesters, environmental activists, and others wanting to register their disaffection – and in some (albeit minority) cases engaging in violence and destruction of property.

Of course protest is a form of free speech which a democratic society must protect, irrespective of the merits of the protesters’ message. Clearly such protection does not cover violence and destruction; but even there we have a lesson to learn. Current economic events carry risks not just because of the havoc they are creating and the misery they will leave in many people’s lives across the world; they are dangerous also because they may create a setting in which public order and security are endangered. Politically inspired violence on the streets was a common feature of Germany in the late 1920s as the economy spiralled out of control and unemployment rose; and such violence provided fertile soil for the fascist movement that then managed to take over in 1933.

The desire of President Sarkozy and Chancellor Merkel to highlight regulation of the financial sector as a main aim of international action is understandable, but in terms of the top focus of the G20 summit it is not the priority. Regulating the banks will not create or save any jobs. Setting up the best regulatory framework is not a job for high level political summits, but one for experts working behind the scenes. What the politicians need to do is to generate confidence that something is being done to tackle the deepening recession, and that this something will have an economic effect and will generate employment and trade. That is why Barack Obama is right, and the French and Germans are (for the purposes of this summit) wrong. And for all our sakes, I hope this event ends in agreement and in action that will make a difference.

Miscreant universities

March 23, 2009

I have a terrible, terrible confession to make: I began my professional life as a banker. There, I have been courageous enough to say it. Admitting to being a banker seems these days to be akin to confessing to a life as a drug dealer or a time share salesman. Right now it seems likely that, having made this confession, I shall be shunned by all right-thinking people. In my defence I can say that I abandoned that path of roguery in the 1970s, so it is all so terribly long ago; and I never claimed, nor did I receive, any bonus while I pursued that particular life.

In any case it hardly matters, because there are days when I cannot help feeling that the profession I chose instead has turned out to be equally shady – I became an academic. Today I bought three Sunday newspapers – two Irish and one British – and each one of them has articles and news items that suggest universities are full of under-performing and over-paid layabouts; and that as institutions they pursue completely useless activities that are a drain on the taxpayer.

One particular bit of commentary that caught my eye was in the Sunday Independent, in an article by the economics editor of the radio station Newstalk 106 Marc Coleman. The article generally was about cronyism in government and the public sector. And thrown into the mix, à propos of nothing as far as I could see, was the following:

Will universities be forced to publish accounts? Will incompetent lecturers be sacked, as incompetent bankers have been? Will recalcitrant ones be forced to do what they’re paid for, ie, lecture their students? Will the Government stop wasting money on useless third-level research and divert the saved funds to creating more primary-school teaching posts?

This is extraordinary stuff, and full of ill-informed innuendo. As far as I am aware, all universities do publish their accounts. Certainly DCU does. It is, I agree, very hard to sack a lecturer, and in many ways it should be, not least because it is necessary to maintain protection of academic freedom; but all universities now have performance management systems. Will lecturers be forced to teach students? They do teach students, and I have hardly ever come across one who refuses (and in those very rare cases where that might happen, we have acted). Useless third level research? As the IDA has recently confirmed, third level research is what is now mainly attracting foreign direct investment; almost every significant recent investment has been in some way linked to research or R&D.

I suspect that the last paragraph sounds defensive. But unless we understand as a country that the excellence of our universities is what will, perhaps more than any other single item, determine our way out of the recession, we are doomed to go back to national mediocrity.

I don’t doubt at all that there are still many things that need to change and many improvements that need to be made in our university sector. But to suggest, as is so frequently done right now, that there is something fundamentally wrong with our third level sector is ludicrous. Except that it is dramatically under-funded, and that the means to produce some of the reforms still needed are denied to the institutions.

Of course universities must operate in a transparent and accountable manner. But that of itself won’t make them world class. And if Marc Coleman would like us to have an economy that warrants an economics editor at Newstalk 106, he might want to take a closer look at what universities really do.