A far-reaching reform agenda of the financial system is needed, backed by an ‘Arab Spring’ of public opinion, according to Paul Moore, the former head of group regulatory risk at Halifax Bank of Scotland (HBOS), who is internationally known as ‘the HBOS whistle-blower’. ‘Vested interests and the power of the financial lobby seem to have won the day, and nothing seems to have really changed,’ he said. He was speaking at the opening of the ‘Trust and Integrity in the Global Economy’ conference at the Initiatives of Change centre in Caux, Switzerland, 3 August 2011.
Moore was the only senior risk and compliance executive in the UK banking sector to speak out publicly in the aftermath of the financial crisis about what he saw from the inside of a bank. His influential evidence to the Treasury Select Committee in the UK parliament was widely publicized in the world’s media and led directly to the resignation of the Deputy Chairman of the UK’s Financial Services Authority.
Moore continued, ‘The majority of ordinary people on this planet know very well in their hearts and souls that a profound change is needed in the way we live’ to avoid the potential for a global disaster brought about by excessive consumption and the climate change it causes. ‘Almost everyone I meet seems to know that the pervasive culture in the developed world of “me, more, now” in which GDP and continuous economic growth seem to be the only mantras around is not the true road to well-being for all of us, let alone social justice,’ Moore went on. ‘We have totally lost our way in a sea of greed and vanity.’
The British banker called for like-minded groups to gather and organise for action. ‘Above all,’ he went on, ‘we need to find a way speak up much more loudly than we have done to the “group think” of the establishment.’ ‘Do we have the courage and energy to do what needs to be done? Are we prepared to speak up and take action, or will we just make do with a comfortable conference?’ he challenged. The political and moral challenge was to ‘speak truth to power’, he said.
He reminded his international audience of the example of the Arab Spring, which had demonstrated the power of popular movements. ‘The odds seem heavily stacked against us and the seeds of our own destruction seem to be built into the very DNA of an economic system where the key measure of success and satisfaction seems to be how much money you have and how many possessions you own,’ Moore said. For example, he claimed, there were five financial lobbyists for every member of the United States Congress. ‘Far from seeing the light at the end of the tunnel, I find it difficult to see anything but an express train hurtling towards us.’
The financial lobby, he affirmed, seems to have found a way to prevent any proper investigation into what really caused the banking crisis. ‘No-one has been held to account and the reform agenda has been half-hearted with far too much focus on capital and far too little on the conduct of business,’ Moore went on. According to him, the crisis was largely due to ‘a dysfunctional and unethical culture where trust and integrity do not exist’. Most ordinary people, he believed, saw the banking crisis as a symptom of much deeper problems in the world today. The need was ‘to rebuild our public policy around the financial sector in a way that not only served the real economy but also the common good of the whole of humanity,’ he concluded.
Responding to the British ‘whistle-blower’, Alain Berset a member of the Council of States (the Swiss Federal upper house) for the canton of Fribourg, and a self-employed consultant on strategy and public relations, thanked Moore for his speech, but also thanked him warmly for his example of courage. Berset spoke of his own efforts to look into the governance of the big Swiss banks, ‘giants that are faced with regulatory dwarfs’. The power of financial lobbies to protect themselves, he suggested, posed a question to democratic systems. Berset, who was elected to the Council of States in December 2003, and has been Vice-President of the Social Democratic parliamentary group since December 2005, outlined a history of the crises: 2008 a financial crisis; 2009 a crisis of ‘the real economy’; 2010 a social crisis, with rising unemployment; and now in 2011, a crisis of public finances, of sovereign debt. ‘The only people who are not paying any price in all of this are those who caused these crises,’ Berset said. ‘As a politician, I am very worried,’ he went on, ‘about how quickly we are turning the page and not learning the lessons.’ He thanked the conference organizers for their choice of their theme. ‘We are all in the same boat. This is not an end, but the beginning of a fresh reflection on society and the economy, for the common good,’ he concluded.
The ‘Trust and Integrity in the Global Economy’ conference, the last of the four of this season at the Initiatives of Change centre continues until 8 August. It will explore ways to help create a just and equitable global economy, against the backdrop of the economic crisis in Greece and its impact on the EU economies and the US debt ceiling debacle. The conference is attended by over 200 participants, including businessmen, industrialists, economists, environmentalists, students and concerned individuals.
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