In an effort to drive strategic change and invest in a new talent, some banks are left with no other choice than to drop the axe on their leaders. While ditching chief executives was once at an all-time high in the U.S., it seems that the attention has shifted to Europe.
A Financial Times article reports that there has been a shift in power in some of Europe’s major banks such as Credit Suisse, Deutsche Bank, Standard Chartered and Barclays—a sign that the past still weighs heavily at Europe’s top financial institutions. The article points out that dealing with the post-financial crisis remains a major hurdle for many companies and now even regulators are feeling the heat, with Martin Wheatley ousted from the Financial Conduct Authority.
In all of these cases, Britain stands out the most. As companies and regulators look to change its strategic direction and usher in a new culture, a few emerging trends have come to light:
Based on the announcements from FCA and Barclays it is clear that Wheatley, and Anthony Jenkins’ former CEO, Barclays were canned. The Financial Times report claims that both executives were let go because they were no longer the right fit for the job and the language used in the announcements is a clear indication that both executives were sacked.
Next, there was a lack of transparency. In these high-profile positions, friends do matter. Even though Jenkins received favorable attention from external stakeholders and investors, non-executives felt he had a “standoffish attitude" and he never worked to create the right culture for the company. Wheatley, was on the same boat. Financiers complained that the former head of FCA assumed that “everyone was cheating” and the way in which he regulated lacked transparency.
The government is also softening its blow on financial institutions. In June, U.K. Chancellor George Osborne stressed in his speech that he wants Britain to remain the best place for European and global bank headquarters. While he imposed a new 8 percent supertax on the banking sector, the reduction of the hotly debated bank levy was a sigh of relief for financial institutions.