As the saying goes, ‘if you pay peanuts, you’ll get monkeys.’ Judging from some of the recent announcements about bonuses from Barclays, Lloyds et al, it seems that the people who run Britain’s biggest investment banks are irrationally terrified of ending up with monkeys for employees.
The latest instalment of bonus season – that rather tiresome annual fixture in the City of London calendar – was accompanied by all the usual platitudes from bank CEOs about how they have to “attract and retain talent in a highly competitive global marketplace.” Yada yada yada.
I’m all for talented people being well paid. But the trouble with this argument is that, by and large, if you pay shed-loads of money, you may avoid having any monkeys on your books, but you will almost certainly end up with a bunch of greedy, profit-hungry pigs.
I wonder whether the thought has occurred to anyone sitting behind the crumbling old façades of the Square Mile or in the shiny new tower blocks of Canary Wharf that they may be approaching this whole “war for talent” in the wrong way? Apparently not, so let me explain.
If you focus exclusively on remuneration as the key differentiator in this global market, as all the big banks currently do, then you will, more or less inevitably it seems to me, end up attracting people with a fundamentally dysfunctional attitude towards money. Call it lust or love, the type of person whose primary motivation in life is the promise of being able to splash the cash on a fast car or a fur coat each bonus season, and then retiring at 47 following their second coronary bypass operation, has an unhealthy obsession with dosh.
To me, these don’t sound like the kind of people who should be investment bankers. To use an extremely non-PC analogy, it’s like putting the fat kid in charge of watching the cookie jar.
But what if investment banks made a whole new kind of deal with their employees, where remuneration became one part of a broader package of benefits they offered, rather than the sole selling point?
Imagine what that package might look like:
- Reasonable hours – by which I mean, staying in the office past 6pm should be an exception rather than the rule, and a work-life balance should be seen as a basic right of all employees, rather than something for those who aren’t man enough to hack the pace. And at weekends (which I define in the traditional way as running from 6pm on Friday until 9am on Monday, NOT until 9am on Sunday, as per Goldman Sachs), employees should be encouraged to switch off their BlackBerrys and should only be called into the office if there is a genuine emergency to deal with.
- A wider sense of purpose/the chance to feel good about yourself and what you do – I know some will scoff at the idea that an investment bank could ever have a purpose beyond generating as much profit as humanly possible, but it’s not as far-fetched an idea as it sounds. All the industry needs to do is remember that its original raison d’être was to provide a service to customers. Investment bankers aren’t likely to cure cancer or solve global warming, but they will almost certainly provide the financing to the people that do. If investment banks were half as strategic in the way they think about their social and environmental impact as they are when it comes to generating short-term profits, then maybe their employees could go home each night feeling genuinely proud that they had contributed to something good. Maybe.
- The chance to work with nice people – it may sound absurdly simple, but I reckon this is a hugely under-rated factor in determining most people’s job satisfaction. For a company, the impact on retention of having a group of nice people could potentially save you millions in bonus payments. And ironically, by handing out stupid wads of cash on an annual basis, banks are almost certainly making their employees less pleasant colleagues. Which means next year the bonuses will have to be even bigger if they really expect people to put up with having to work with a bunch of egocentric, money-obsessed, sleep-deprived sycophants.
- A degree of autonomy – everyone knows that boring jobs have to get done and nobody likes doing them. But a shift away from the traditional “command and control” style of management towards a more open and empowering culture could make a big difference to how appealing a career in finance looked to many genuinely talented people.
If this, plus a middling salary and negligible bonus, was the offer on the table, what kind of investment bankers would you get?
For a start they would be different from today’s lot in that they would have the chance to interact with ordinary people (including their families and friends) on a regular basis, as opposed to spending all of their time in an office with other investment bankers. They might therefore do better at taking into account the myriad interconnections between what they do at work and what goes on in the outside world in the decisions they make, simply because they are at least somewhat familiar with the outside world.
The investment bank that re-configures its offering to employees in this way may not end up being as profitable in the short term as its competitors. But, in every other sense, it would be a better business. Instead of monkeys or pigs, it might actually attract a few humans to come and work for it.