IT’S BEEN A week full of accusations and, ultimately, resignations in the recent phone hacking scandal. Most recently, Sir Paul Stephenson has resigned from his role at the head of the Metropolitan Police. Last Friday Rebekah Brooks resigned from her chief executive job at News International and today faces a House of Commons Select Committee.
I can’t help but feel that the resignations strike totally different chords.
Many people have found themselves in a situation where they could have done better. Some will have found themselves in a situation where they have possibly overlooked something or not investigated a particular matter as far as they should. Such is the case with Sir Paul Stephenson, his actions have been very much at the forefront of the media onslaught over the last couple of days and certain areas of his decision-making have been called into question.
But his swift resignation is immediately associated with integrity and credibility.
Not so the resignation of Rebekah Brooks. As the Chief Executive of News International she is responsible for the actions of the group. She had steadfastly refused the mounting pressure for her resignation and had not responded to the many allegations that had been put to her.
Personal accountability is too bitter a pill to swallow
This reluctance is seen time and time again, be it amongst the many disgraced bankers in this country that are still coming to terms with their actions of the last few years or the developers and investors who have over-leveraged and still feel inclined to accuse everybody else for their own misgivings. Personal accountability and acceptance of their actions is too bitter a pill to swallow.
Reputation is important to us all, and when confronted with a situation where your reputation is sullied, the natural response is to try and repair it as quickly as possible. In the case of Sir Paul Stephenson, his resignation at the earliest opportunity immediately goes some way to restoring that.
It’s not always so easy to do this though and I was reminded of this in person a few weeks ago when I had occasion to meet Peter Norris again, sixteen years after the collapse of Barings Bank.
Peter was the Chief Executive of Barings Investment Bank and controlled the organisation that had responsibility for my own area in Singapore. Peter was perhaps the first and only person to publicly admit that he should have known what was going on in Singapore but it was equally obvious that he had experienced some very testing times at that moment and subsequently. My apologies may have sounded hollow on the day but they were sincere. Peter’s career is definitely back on track but only after a slow and laborious process.
My own reputation hit the floor sixteen years ago. I’m not sure that I will ever have the opportunity to repair that and I am sure that there are many that will say that is fair sentence. But I’ve always accepted my responsibility and hopefully talk about my shortcomings in an honest and candid manner. If that in turn can provide a message or lesson for someone else then hopefully that can be accepted as a positive.
My shortcomings at that time are far too many to mention but not accepting and confronting them over the last sixteen years would have meant that I would not have overcome them or moved on. I’m sure that Peter Norris feels the same.
One of the spectacular falls from grace… and equally the most spectacular recovery
With Irish bonds downgraded to ‘junk’ status this week I am reminded of one of the most spectacular falls from grace but equally the most spectacular recovery, Michael Milken. His nickname in the 1980s was the ‘Junk Bond King’ and he headed the high-yield bond department at Drexel Burnham Lambert. His salary and compensation packages in the late 1980s exceeded $1bn in a four-year period which was a record at the time.
Drexel went bankrupt in 1990 shortly after Michael Milken was indicted on 98 counts of racketeering and securities fraud. After a plea bargain, he pleaded guilty to six counts of securities and reporting violations and was released from prison after two years.
Milken did more than most to turn his reputation around. In a November 2004 cover article, Forbes magazine described him as ‘The Man who Changed Medicine’ for his positive influence on medical research borne out of his large philanthropic donations. He is reported to have a net worth of around $2bn and is ranked by Forbes magazine as the 488th richest person in the world.