The recently released minutes from the Bank of England’s governing body make interesting reading for all those who have studied the causes of, and the lessons learnt from, the recent banking crisis. The minutes, which cover the period from June 2007 to May 2009, have been released in response to a request from the Treasury Select Committee and reveal how little The Bank’s hierarchy were prepared for the scale and depth of the crisis. As Lord John McFall commented to the BBC “They missed the interconnectedness of the whole financial system.”
Whilst the regulatory system has since been transformed, some of the lessons learnt could well benefit those in a position of leadership in organisations across multiple business fields today. These include:
- The importance of board members challenging information rather than acting as a consensus-driven talking-shop.
- The importance of clearly defining governance roles rather than assuming that some areas are ‘somebody else’s problem.’
- The importance of ensuring that those below board level are not simply telling the leadership what it wants to hear rather than highlighting potential problems.
Whilst it is true that hindsight is a wonderful thing, leaders who are prepared to question, who are open to the ideas of others or who are able to move away from a narrow organisation-centric view are far more likely to be able to anticipate and therefore prevent the worst effects of any crisis.