Rewarding Success
The news media seems to have latched onto another hot button issue – bankers pay.
I read today that one of Barclays’ board members, Bob Diamond, has made £5m by selling some shares in Barclays, and that 23,000 staff at Barclays Capital are to receive payrises. If Barclays had received government money in the recent bailouts, I could understand the outcry, but Barclays was the only one of the “big four” retail banks not to take a penny from the taxpayer.
Barclays’ financial solidity, which remains despite the takeover of parts of Lehman Brothers, is down to its investment bankers. Clearly the good men and women of Barclays Capital,� led by Bob Diamond, � have obviously been doing something right with my hard earned brass, because their position is an order of magnitude better than Lloyds TSB Group, RBS Group and HSBC. I’m all for rewarding the people who are keeping my money safe! But the Guardian seems to think this isn’t fair. They also seem to think that there’s something unsavory in Bob Diamond realising £5m in cash through selling shares, which are after all his property already.
This country certainly has a culture of rewarding failure, as has been shown by some of the recent bonuses paid on departure of failing Chief Executives. However, we shouldn’t lose sight of the need to reward our brightest and best, those who individually are performing well despite these difficult economic times. We also need to be very clear that corporate poor performance does not equate to individual poor performance, and ensure that we don’t tar all employees of struggling organisations, such as our banks, with the same brush.
The current economic crisis is unfortunate, and has led to personal hardship for a great number of people. But the simple fact is, the banks are not entirely to blame. Yes, they were willing to lend, but we were also willing to borrow.
Becoming a high-earner in any organisation, be it a bank, a public sector organisation, a PLC or a limited company, is not as easy as the papers seem to imply. The top executives in this country were not born with a six figure paycheque earmarked for them, they worked hard and for long hours to attain their position. I don’t see what right I, the Guardian, or anyone else, has to stop them enjoying the fruits of their labours.
I’m certainly not in favour of abject poverty, homelessness or starving children. But we need to be clear about WHY we’re a developed country – generally it is down to the personal contribution of political, social and business leaders in mobilising the masses to achieve a positive change, development.
Incidentally, the top 50% of the population by earnings contribute 89% of the tax bill, with the top 1% contributing over 24% of the nation’s wealth. Granted their own wealth far exceeds the amount contributed in tax, but there needs to be a degree of consideration about what these people give society. The rich are often the leaders, the people that make things happen, the people that excel in their field (Bernie Ecclestone, for example), the people that save jobs on the High Street (Phillip and Cristina Green), the people who bring us mass-market best selling products and services (Richard Branson) and the people who bring us innovation and originality (James Dyson).
What would the world be like without this class of rich people? Consider Communist countries such as China, or North Korea. Anyone fancy making a move this Christmas?