A few weeks ago a happy group photograph was published to accompany the announcement of Bob Diamond’s appointment as the new CEO of Barclays bank. The picture showed outgoing CEO John Varley and Diamond himself, both apparently chortling with delight, while chairman Marcus Agius offered a slightly more discreet smile of approval. What were they laughing about?
Well it could be money. Diamond’s pay for his new job is £1.35 million a year. By today’s banking standards, that’s not a lot really. A headline in The Times of 26th March 2007 read “Rewards for Barclays’ Diamond hit more than £80m – The bank’s president and boss of BarCap collects £15.2m in salary and perks.” Compared to which, £1.35 million seems quite miserable. Mind you, as the Daily Mail reported, he could also “recoup an annual bonus worth up to £3.375m this year” and “long term performance based incentive shares worth £6.75 million next year.” That should be worth a quiet chuckle.
Schumacher argued back in 1973 in ‘Small is Beautiful’ that the world was being destroyed by greed which was encouraged by economic theory : “If human vices such as greed or envy are systematically cultivated, the inevitable result is a collapse of intelligence. A man driven by greed or envy loses the power to see things as they really are, of seeing things in their roundness and wholeness, and his very successes become failures.”
Part of the ‘roundness and wholeness’ would be to see his role in the context of society overall and its exploding inequalities. Moreover, to imagine, as Peter Drucker once put it, ‘the hatred, contempt and even fury’ that is created by bosses paying themselves excessive amounts. Those will be the feelings with which most human beings inevitably regard Diamond. But that needn’t bother Bob. But his “legacy” might. Succeeding generations of his own family might be put to shame by his excess, as they face the world this generation has bequeathed them. Diamond’s successes might then be recognised as failures. Maybe that wouldn’t be so funny.