Horta-Osorio is back at the helm at Lloyds after three weeks off for exhaustion. His first leadership decision? To refuse a £2.4m annual bonus on the grounds that he simply doesn’t deserve it.
MT is just going to go right out and say it: What a guy. Last year, he braved the derision of peers and City analysts when he admitted extreme stress and took a leave of absence. Then he defied naysayers who swore he would never return. He withstood a gruelling cross examination from the whole board and an independent medical examiner and convinced the Lloyds head honchos that he was fit to come back after a mere three weeks out of the office. Now, he’s making a moral stand on inflated bonuses.
It may be a strategic PR move, but begad it's worked. MT also imagines he finds time to help old ladies across the road.
‘As chief executive, I believe my bonus entitlement should reflect the performance of the group,’ he said in a statement today, adding that with the ‘tough financial circumstances that many people are facing’, it was against his principles to accept the cash. Lloyds chairman Sir Win Bischoff has accepted the Horta-Osorio’s request.
Of course, the Lloyds chief isn’t entirely out of pocket: he still has a £1.06m salary. And it's not the first time a chief executive has foregone his bonus - International Airlines (nee BA) boss Willie Walsh has done it a couple of times. But his decision will send a powerful message to the rest of the banking industry, just as bonuses are being doled out across the sector. It’s time to change the bonus system to reflect performance and market conditions, is the clear message. David Cameron will be extremely pleased.
But it remains to be seen whether any other banks, or indeed individuals, follow suit…