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Vince the Cable Guy is much more refined than his American cousin, Larry, but he is certainly no less opinionated. In fact, he has managed to grab quite a few headlines in the last several days as he flexes his muscle as Britain’s Business Secretary in attempts to correct all that he perceives is wrong with UK businesses.
Boot former HBOS bosses
Cable has ordered an investigation into the activities of the former executives of HBOS, Sir James Crosby, Andy Hornby, and Lord Stevenson. The point of the investigation is to determine if the men are eligible to be banned for life as directors of any company under the authority of the Company Directors Disqualification Act. A report issued on April 10th cited “toxic misjudgments” that led to the banks collapse and specifically pointed to Sir Crosby as the “architect of the strategy that set the course for disaster.”
Cable has also called John Griffith-Jones, former KPMG chairman, into question. It was his company that audited HBOS and gave it a clean bill of health despite an obviously flawed business model and impending collapse. Griffith-Jones is currently the chairman of the FCA, which should be somewhat worrisome for a lot more people than Vince Cable. Griffith-Jones was party to a meeting when it was decided that the FSA would not investigate KPMG. Alan MacDougall said that “It cannot be right that the chairman of the new FCA has any link with the second largest UK banking collapse in history. He should at least step down until the performance of KPMG in the audit of HBOS . . . has been properly and independently investigate.”
Andy Hornby is currently the CEO of Gala Coral, a chain of betting parlors. Lord Stevenson is a non-executive director at Waterstones. James Crosby has resigned from his position as an advisor for Bridgewater at the company’s request. He has also voluntarily given up his knighthood.
Boost more women board members
On a completely different matter, one which this writer believes that is not where government belongs, Vince the Cable Guy has threatened today that if FTSE companies do not significantly increase the number of woman in director positions, he may lead the government to force the issue. Although the government espouses the approach that companies act voluntarily on the matter, Cable (or someone above him) does not believe he is seeing the “progress” that they would like. It could be that Britain’s attempt to block legislation that would require 40% of the non-executive board members of companies in the EU be woman by 2020 is being perceived as being undermined by a less than anticipated corporate response.
Frankly, Cable’s observation that “This is not just about gender equality, but about improving the performance and productivity of companies,” is poppycock. He clearly spoke to his fears in a letter sent to FTSE companies with all-male boards, “I do not believe that EU legislation would help us achieve greater boardroom diversity, but it will be harder for us to enforce that case without progress here in the UK. I would ask that you redouble your efforts in overcoming the barriers that may hinder your progress towards achieving gender diversity within your boardroom.” With all due respect, Cable Guy, What did you just say?
Who, with half a brain, ever said that “diversity” in the boardroom is in any company’s best interest? Does it affect productivity? Does it affect efficiency? Does it affect profitability? Or does it have more of a down-side than an up? Why isn’t there a drive to have more handicapped people on corporate boards? Why not more teenagers? Why not a fair percentage of homeless people? Surely they need to be included.
My question is how can a man be so right about pursuing justice where the people of England have been hurt financially, and so wrong about “diversity” being a factor that would drive UK companies from being good to great. Success is not about having diversity in the workplace – at any level. It is about have the right people on board and everyone of them sitting in the right seat.
Note: The opinions of this writer do not necessarily reflect the opinions of ADVFN.
