You may not be moved to tears by the woes of bankers, but a ‘climate of fear’ around failure could in fact make financiers more prone to behaving badly. And that’s no good for anyone. So it’s heartening to see UBS chief executive Sergio Ermotti reassuring his staff that making mistakes is ok - as long as they’re honest ones.
The banker said there was a difference between those who break rules and those who make honest errors, in an address to 300 of his senior managers in Zurich, according to the FT, which spoke to attendees. There has to be a ‘degree of tolerance’ for the latter, he said, otherwise nervous bankers could run away from genuine, good business.
Indeed, when faced with potential negative consequences, such as getting penalised for poor performance, managers in the financial sector are more likely to get anxious and behave unethically, according to a study released by PwC earlier this year. When presented with possible positive outcomes, on the other hand, they were more likely to get ‘excited’ and be innovative.
UBS, for its part, is in better shape than it has been for years, after billion dollar fines for everything from Libor fixing ($1.5bn/£980m) to forex fiddling ($1.4bn) and tax evasion ($780m). Oh, and don’t forget the $2.3bn hit it took from rogue trader Kweku Adoboli in 2011.
So the Swiss bank knows better than any company about badly behaving staff – and you’d hope by now it knows how to rein them in. Meanwhile, politicians should think twice before indulging in yet more banker bashing. Jeremy Corbyn and John McDonnell, we’re looking at you.