Barclays (NYSE:BCS) announced that their former wonderkid will voluntarily forgo some $31 million in deferred compensation. The word voluntarily is a joke. The agreement to forego is like a drowning man attempting to lose his concrete overshoes. Basically an excellent idea at the time.
The problem is governance. How can the board not understand what was going on. Was Robert E Diamond not telling anyone what was going on. Lets take a look at some of the board members and see what they are bringing to the board:
Andrew Likierman must rue the day he agreed to become a director. Currently Dean of London School of Business, formerly 10 years spent as Managing Director, Financial Management, Reporting and Audit and Head of the Government Accountancy Service at HM Treasury and oh by the way a non executive director of Bank of England. talk about dancing between the rain drops. He may come out clean of culpability but will go down as a terribly incompetent director for not realizing this problem existed and taking steps to stop it.
Christopher George Lucas as director was responsible for a number of Group functions including Finance, Investor Relations, Treasury, Tax, Corporate Development and Corporate Secretariat. OK buddy you have a big dog audit resume and it all happened on your watch while you had executive responsibility and board membership.
The majority of remaining independent directors all have extensive and I mean extensive experience in financial institutions, capital markets, investment banking and everything else you want to have on a board to avoid the LIBOR mess. But they all failed.
So fine Diamond goes. Marcus Ambrose Paul Agius is trying to get out-of-town and will eventually be ridden out on a rail when the Bank of England says so. The new chairman will have to revamp the board as they all failed in their fiduciary responsibilities to take care of the shareholders.
George Gutowski writes from a caveat emptor perspective.
- Bob Diamond waives bonuses and incentives worth a potential £20m (independent.co.uk)
- Barclays chairman admits Mervyn King forced decision for Diamond to quit (guardian.co.uk)
- Barclays Chairman Falls on His Sword. Many Swords Needed Immediately $BCS (financialskeptic.wordpress.com)
- Libor scandal: Bob Diamond gives up £20m bonus – BBC News (bbc.co.uk)