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Enforced holidays are not unusual in the current climate as companies seek to cut costs by encouarging staff to take extra holiday for little or no pay.
But the chief investment officer of an asset management firm visiting the FT revealed his enforced holiday, coming up soon, was due to a policy put in place to guard against rogue traders. It was instigated in response to Société Générale’s €4.9bn trading loss at the hands of trader Jérôme Kerviel, revealed in January 2008.
Mr Kerviel did not go on holiday much, apparently, having had four days off in the eight months before the problems were discovered. He was asked to take a break in December 2007 but declined to do so. He had to be at work to maintain his deception about the large trades he was making. Failing to demand he take time off was seen in retrospect as a mistake.
The FT reported at the time that most investment banks require traders to take at least two consecutive weeks’ holiday a year, which limits the scope for concealing their positions.
Asset managers have followed their lead, it seems, with this group, Baring Asset Management, imposing a minimum eight day break. Workaholics are not allowed to indulge their addiction.
How common is such a policy in the asset management world I wonder?