Why business is like... traffic calming

Accidents on London's Kensington High Street were almost halved last year with one counterintuitive act: removing the road safety features. It turns out that the barriers designed to protect pedestrians were only making life more dangerous.

Last Updated: 31 Aug 2010

Motorists had been able to travel between pedestrian crossing points at speed, assuming that the railings and zebra crossings would prevent a nasty surprise. Removing them forced drivers to stay alert and keep their foot on the brake, as pedestrians were suddenly free to launch Frogger-style charges for the far side from any spot on the pavement.

This story highlights how a light touch from on high can lead to greater self-regulation from below. And as the Government fields calls for better monitoring of our financial markets, could it be a parable for how to reduce casualties in the economy?

Sadly not: the FSA has taken the same approach for several years. Back in 2005, Gordon Brown promised 'no inspection without justification, no form-filling without justification, and no information requirements without justification. Not just a light touch but a limited touch.' We know what happened.

So if removing the safety barriers from High Street Ken worked, why did our economy suffer such an almighty prang when the fiscal authorities did the same? It's all about risk levels: speeding drivers risk a death on their hands. In banking and finance, the dangers are less tangible, so a lack of controls is like a sign saying 'floor it'. Plus, landing a couple more million is far more of a spur than simply shaving a minute or two off the school run.

So what to do instead? Instruct bankers in the basics of the Highway Code, for starters. The rest of you: look both ways before you cross.

Jennifer Harris is director of JRBH Strategy & Management, www.jrbh.co.uk.

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