It’s the little things that were a pointer to Fred the Shred’s failings

NEVER mind dress-down Fridays.

What every office really needs is a Give Out Monday; a regular gathering over coffee, where everybody voices their pet hates. It happens all the time anyway, so why not make it like a bank holiday, only for bitching. Last week, for example, one of our people did a spectacular rant about those who leave out the sugar overnight, uncovered. You never knew what would get at it. (Cue theatrical shudder.) This time of year, it would attract wasps. But any time of the year, it could lure ants. (Cue even more theatrical shudders.)

We all nodded solemnly and made a resolution never to leave out the sugar again. None of us had ever thought of it as a personal bad habit which could drive someone else out of their mind, but it clearly was and could. Someone else followed up by saying they hated people who brought overcoats or anoraks or jackets into the office and put them on the back of their chairs. It was so slovenly and lazy and disrespectful and disgusting.

“And people who put stuff on top of the shredder,” was the next offering. “Blocking up the aperture so you have to put down what you want to shred, move the obstruction and then load the shredder.”

The pet hates were all about relatively minor actions that people could fix by just the most minor good resolution and a bit of attention. They weren’t about habits rooted in someone’s character which might upset them if amputated, like one worker falling downstairs. I’m not saying she was born with a falling-down gene, but that’s my guess, because she really isn’t happy any week until she’s done it.

It’s more difficult to do it in the new building, because although we have piles of stairs, they’re all broken up with turns and landings. It doesn’t matter. She can still descend two storeys at high speed, casting cups, jugs, pats of butter and bowls of sugar as she goes.

Last week, the carpet at the bottom of the stairs was a darker colour for several days because she’d done her weekly fall carrying a tray of waterjugs. We were picking shards of glass up using the soft side of a bar of soap for hours afterwards and I wouldn’t bank on extra business coming from the clients who were around to hear her descent. It sounded like we did nixers for Murder, Inc or the local abattoir.

Any fool can distinguish between an interesting idiosyncracy (falling downstairs once a week) and an irritating habit (leaving something on top of the shredder.) Just as any fool can distinguish between an irritating habit and an action likely to destroy the share value of a company. Except for individuals like Fred Goodwin, FRSE FCIBS, former CEO of Royal Bank of Scotland, who managed to combine both — and to get away with it, at least for a while.

Fred was and is a strange bloke, no matter which way you look at him. He’s a chartered accountant who became known as Fred the Shred because of his rigidly ruthless cost-cutting, and who attracted the attention of someone at the top of the British banking industry, who gave him the top job in RBS.

Now, it wasn’t that much of a top job at the time, because RBS wasn’t that much of a bank at the time. But it had a bit of cash and could borrow more cash, and didn’t Fred the Shred go on a buying spree. Never saw a financial institution, did Fred the Shred, that he didn’t want to buy and add to his growing portfolio of banks. This would have been in the early years of this century, when, some readers may remember, things were looking up.

AS LONG as Fred added to the value of his bank by buying other banks, most of those around him, particularly shareholders, were like little smile badges, they were so happy. They glossed over trenchant criticisms of Fred which suggested that he a) didn’t understand all the essential areas of banking, b) kept out of those areas, c) didn’t seem to know how to grow anything organically. He wasn’t so much a CEO or a visionary businessman as a myopic shopaholic.

He was like one of those people who hit the newspapers every now and then — or used to, back in the days when credit card suppliers were relaxed about exceeding your permitted amount — who had spent all before them on things they never wanted or needed.

Those shopaholics tended to have shopping bags with unopened goods in them stashed under the stairs. Fred didn’t need a staircase hideaway. He might have been a one trick pony, but his shareholders really liked his one trick, back in the day, as RBS came from the back row and turned into one of the world’s biggest company.

What, at that stage, was not to like about Fred? People besotted by the possibility of profit-driven dividends have remarkably little interest in hearing from those who might have a reservation or two about the guy who’s delivering those dividends. So the oddity of Fred’s behaviour in branches and other offices went unnoticed at a high level at the time. It was noticed plenty at a mid and low level within his bank.

He did the town hall thing where the CEO goes around to branches to answer questions in a forthright fashion, and conclude by telling the troops that “Our people are our greatest asset”. He did that, did Fred, and he made copious notes of the time, the place, the name and the title of the manager who had asked an awkward question, and no matter how he did it, he subsequently made sure that manager’s career bit the dust and he or she hit the exit door.

He also got livid over items left on the top of filing cabinets. Fred hated it so much, he ordered new filing cabinets for every office in every branch, those new filing cabinets having a dome-shaped top, off which stuff would slide.

Bonkers? Demonstrably. Barking? Hear him bark — just remember to call him Sir Fred, because this weird man was knighted in 2004 because of his services to banking. That was before his bank went under in the most catastrophic collapse in British banking history and he was stripped of his knighthood.

All of the signs had been there from the outset. It wasn’t spindoctors or politicians, or even the banker himself who managed to divert media, regulators, shareholders and others from the truth. It was growth. Profit. Being in the right place at the right time persuades many otherwise rigorous scrutineers into astonishing short-sightedness. But — in parallel — it shuts up many expert witnesses who could point to ghastly and weird behaviour that should raise serious questions over the competence of a CEO. Like domed filing cabinets.

The rising tide lifts all boats. The problem is that some of the boats would be better left underwater. And no boats should be praised, lauded or rewarded for their inevitable tidal rise.

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