Why the era of banking apologies must end for a new economic normal
In short: After the 2008-09 financial crash, the banking sector faced intense scrutiny and public blame. But is the pursuit of accountability actually hindering economic growth? Professor Kenneth Costa argues that moving past mere remorse is essential to rebuilding a functional commercial spirit.
The global financial crisis of 2008-09 was not a standard cyclical downturn; it was a seismic, epochal event that pushed the Western economy to the brink. In the aftermath, the banking sector became a primary scapegoat for the crisis. Figures like Bob Diamond, then Group Chief Executive of Barclays Bank, faced significant backlash for suggesting that the period of remorse and apology from banks needed to end. Diamond argued that for the UK private sector to thrive, banks must be permitted to take risks once again.
While Diamond’s 2011 comments to the Treasury Select Committee drew widespread criticism, Costa notes that this sentiment was shared by other global leaders. Jamie Dimon of JP Morgan expressed similar views at the World Economic Forum in Davos. This perspective is supported by other business leaders, such as former Tesco CEO Terry Leahy, who cautioned against taking wealth creation for granted, and CBI Director-General John Cridland, who advocated for championing business leaders rather than attacking them.
However, the transition to a 'New Normal' requires more than just abandoning apologies. Costa proposes a structural re-ordering of priorities, a renewed respect for ethics, and the cultivation of a better spirit in business. He warns against the temptation to simply return to the 'old normal.' True progress involves moving away from a harmful anti-banking ethos while maintaining a profound understanding of the moral weight of the recent economic collapse.
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Sources
- Summary by Intellect · source: The New Normal: Rebalancing Our Priorities - Professor Kenneth Costa
- Also: The New Normal: Rebalancing Our Priorities
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