Any other business

Why I’m sad to see Barclays in the dock – and astonished to see John Varley there

24 June 2017

9:00 AM

24 June 2017

9:00 AM

Regular readers know I have an umbilical connection to Barclays, because my father spent his working life there, I was on the payroll myself for a decade, and I wrote a book about the bank’s modern history, called Falling Eagle. So I cannot react objectively to news that the Serious Fraud Office has brought charges against Barclays’ holding company and four former executives in relation to the £7 billion fundraising from Middle Eastern investors, including Qatar Holdings, that saved it from a taxpayer bailout in 2008. On behalf of the extended family of Barclays folk, I cannot feel anything but sadness to see a once-respected institution brought into the dock. All the more so since — despite the shenanigans of RBS, HBoS and all the rest — these are the first criminal charges against any UK bank or senior bankers in the aftermath of the financial crisis.

They relate to £322 million of ‘-advisory’ payments and a £2 billion loan to Qatar Holdings at the time of the fundraising; the loan is alleged to constitute ‘unlawful financial assistance’, since it could be interpreted in court as Barclays lending to itself. The outline of the case has long been known, but goodness knows how long it will take to come to trial. Meanwhile, what is most astonishing to anyone familiar with the dramatis personae of modern Barclays is that among the individuals charged is the former chief executive John Varley.

I first knew Varley in the 1980s as an exceptionally capable young manager, trained as a solicitor, impeccably well tailored and mannered, who always looked destined for the top — but was also universally liked by his colleagues. One of our bosses told me he was ‘the best man I’ve worked with in 30 years’, and many of us thought him a last standard-bearer of rectitude, courtesy and human concern in a City that was changing for the worse. I have often written jokingly, even last week, about ‘the curse of Qatar’; I have no idea what verdicts will result in the Barclays case, but I am very sorry indeed to see that curse fall on John Varley.

Without honour

Honours lists offer a glimpse of the changing public perception of business, or at least of that perception as filtered through Whitehall committees. The upper reaches of last week’s contained none of the ‘captains of industry’ whose predecessors would have populated it a generation ago. The only business-tainted Companion of Honours were the designer Terence Conran and the entrepreneur-philanthropist Dame ‘Steve’ Shirley. Leaving aside Ukrainian-born multi–billionaire Sir Len Blavatnik, honoured for donations to the Tate Modern and elsewhere, the only knighted business leaders were Malcolm Walker, founder of frozen food retailer Iceland, and John Timpson, chairman of the eponymous shoe-repair chain which provides work for disabled people and ex-offenders.


As for the Square Mile, there was a K for the City Corporation’s former Brexit spokes-man Mark Boleat, and a predictable damehood (‘for services to diversity’) for mother-of-nine media favourite Helena Morrissey, the fund manager who has campaigned for women on top company boards.

But if you run a multinational business or bank these days you should expect no public esteem, in gong form or otherwise. Rather you should brace at all times against abuse for being a fat cat and suspicion of being part of an establishment conspiracy. All of which perhaps contributed to Lord Mayor Andrew Parmley’s decision to cancel the Mansion House dinner last Thursday, ‘in the light of the tragedy at Grenfell Tower’, after the Chancellor sent word he would no longer attend to speak.

Business clearly must go on, even after traumatic events, but we had to wait until Tuesday, after the formal start of the Brexit talks, to hear what Philip Hammond would have said at the Mansion House. Crowded as it is with foreign bankers and diplomats — who I have watched on previous occasions snatching selfies in awe of the swagger of the assembled City — this annual feast is also an important exercise in ‘soft power’. But my man who polishes the Mansion House silver tells me ‘the City is very aware of not looking out of touch these days — and banqueting while poor people burn isn’t the image it wants’. Quite so. Andrew Parmley is a headmaster in his day job, not a moneyman, so perhaps unusually sensitive to these issues; and I’m sure cancellation wouldn’t have happened without a nudge from Downing Street. But behind it, I suspect, was fear of the Corbynite mob.

Sir Owen’s example

An authentic captain of industry of a generation ago (who died this week, aged 92) was Sir Owen Green. He built BTR, formerly British Tyre & Rubber, from a dusty group of factory businesses into a high-performing 1980s conglomerate and takeover player. Known for his modest style and tight grip on costs, he was also a quiet but wise member of the board of The Spectator, and it was in conversation with him that I crystallised the views I have expressed ever since on the subject of excessive boardroom pay.

In a May 1993 article headlined ‘Snouts in the Trough’, provoked by huge rises for privatised utility chiefs — and possibly the first full exposition of this debate in the national media — I quoted him: ‘There’s absolutely nothing to be said against entrepreneurs or pop stars creating personal wealth through their own talent… But in many large companies the people at the top are really a type of functionary; the culture and the strategy are already set. In any business which has not been created or distinctly improved by a single person, I can’t see any justification for or any good example being set by trying to keep up with entrepreneurs, who are entirely different animals.’

Despite his example and my sermonising, that distinction between rewards due to corporate functionaries and entrepreneurs is more blurred today than it was then — and is one factor in the growing mood of hostility towards big corporate capitalism.

Subscribe to The Spectator Australia today for a quality of argument not found in any other publication. Get more Spectator Australia for less – just $20 for 10 issues


Show comments
Close