*** DEBUG END ***

A banker’s ethics

13 February 2015

WHEN evidence emerged of large-scale tax evasion through a Swiss subsidiary of HSBC, it was natural that fingers would point at the bank's former chairman and chief executive, Lord Green of Hurstpierpoint, an Anglican priest since 1988. For one thing, he had accepted a post as trade minister in David Cameron's Government, thus making him fair game for political criticism. For another, he published a book on business ethics, quoted by The Guardian this week, in which he argues that "Values go beyond what you can get away with," and that responsibility for companies' ethical behaviour rests "with their boards, of course".

The 2013 accounts for the Church Commissioners, the most recent, show that HSBC ranks fifth in the list of investments, a holding of £39.4 million. Yet there is a real question whether banking can continue to be regarded as an ethical investment. Many of the large banks are currently setting aside funds to pay fines or compensation, having been found guilty of indulging in practices that crossed the line from unethical to illegal. Yet the concept that banks are too big to fail continues to protect them from excessive scrutiny. Peter Selby, a former Bishop of Worcester, wrote two years ago: "We have trusted the banking system with far too much of our well-being, and placed our hopes on money that the system generates for its own profit. The result has been gambling and usury rather than a just and sustainable future" (Comment, 28 June 2013). Other countries, among them France and Spain, have recovered more tax than the UK has from customers of the Swiss bank since details were first leaked five years ago. The parliamentary public accounts committee will want to ask Lord Green about what he knew of the activities of the Swiss bank, and the 8500 British customers who deposited £14 billion there during his time in charge. But it is also likely to summon a former head of HMRC, David Hartnett, who brokered an amnesty with British overseas tax evaders (and who subsequently took a job with HSBC).

The culpability or otherwise of one or two individuals seems to be of little significance when viewing the banking sector as a whole. Yet the Banking Standards Commission focused on personal responsibility when it reported in 2013. Archbishop Welby, a member of the Commission, said: "At the heart of good banks are good people. And if we want to have good banks, we have to believe in fallible people. . . If we believe in fallible people, we will . . . recognise that human beings are both more fallible than a systemic regulatory system will allow, and have greater potential than our pessimism might permit." In the absence of a confession, let us assume Lord Green is a good person. The implication, then, is that his bank was not only too big to fail: it was too big to manage. When millions of pounds of tax revenue are at stake, this is an unacceptable position for a government and an industry to find themselves in.

Letters to the editor

Letters for publication should be sent to letters@churchtimes.co.uk.

Letters should be exclusive to the Church Times, and include a full postal address. Your name and address will appear alongside your letter.

The Church Times Podcast

Interviews and news analysis from the Church Times team. Listen to this week’s episode online

Welcome to the Church Times

​To explore the Church Times website fully, please sign in or subscribe.

Non-subscribers can read four articles for free each month. (You will need to register.)