Company leaders should embody the principles of ethical conduct, as big business remains “in the dock”, Stephen Green, the former boss of HSBC, told a City audience in his first public speech since the bank was engulfed in a tax-avoidance scandal.
Green, who left HSBC to join the House of Lords as a Conservative peer and trade minister in 2010 after nearly three decades at the bank, has yet to be called by any of the parliamentary committees holding inquiries into the scandal.
In a speech at St Michael’s, a church in the heart of the City of London, Green did not directly address the scandal at the Swiss subsidiary of the bank, where he was chairman for five years.
But, in comments first reported by Sky News, Green acknowledged the “widespread public perception that some multinational businesses and some wealthy individuals play fast and loose with the tax rules, so as to squirrel away income into low-tax jurisdictions and avoid making their rightful contribution to the public wellbeing”.
Green, who is an ordained Church of England minister, acknowledged that big business had lost respect and trust as society became “more questioning, more suspicious, more atomised”. He said this attitude could be turned around by responsible boards promoting proactive engagement by their staff and “responsiveness to both clients and community”.
He said company directors had to ensure that the responsibilities of their businesses were “clearly articulated and understood throughout the organisation – and indeed, not merely understood, but accepted and lived throughout the organisation”.
“Even if everyone knows the company’s mission statement off by heart, that’s not the same as living by it,” he said.
But Green said: “The real world of the markets is shot through with imperfections that we will never completely expunge – because we as individuals are similarly prone to failure – because the dilemmas and challenges are real, significant and hard, if not impossible, to avoid.”
Green’s latest comments are likely to be seized on by critics who say the Tory peer should have been more vigorous in his oversight of HSBC’s Swiss division and in enforcing good behaviour there.
Labour MPs have demanded Green be called to account for his time at HSBC. The bank’s Geneva subsidiary, which routinely allowed clients to withdraw “bricks” of cash, held accounts for dealers in arms and drugs, and colluded with wealthy clients to conceal undeclared “black” accounts, was created on Green’s watch.
Leaked HSBC files – which were published by the Guardian and other media outlets and cover the period from 2005-07 – revealed that HSBC’s Swiss bankers aggressively marketed a device that would allow clients to avoid a new tax.
This article was written by Sarah Butler, for theguardian.com on Wednesday 18th March 2015 19.53 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010