Should London’s bankers be shaking in their boots – or watching their wallets – after the release of the Walker Review published this morning?
A large amount of attention has been paid to proposals on bankers’ remuneration, one of 39 recommendations in Sir David Walker’s report. Bonuses are once again in the headlines due to Goldman Sachs boosting the pay of its staff back to pre-boom levels.
Sir David, a former chairman of Morgan Stanley International, wants bank boards’ remuneration committees to take on far more work, scrutinising the pay of anyone who earns more than the average board-level executive.
The FT’s City editor Andrew Hill says that this move was a surprise with a tougher than expected constraint on bankers’ bonuses. The challenge, of course, remains whether any of these proposals will prevent another banking crisis.
Indeed, a push to disclose the pay and bonuses of City high-flyers dominated some discussion this morning on the FT’s Alphaville site, even before the report was published.
While hopes for greater transparency on the part of banks seems to be the gist of government and business reaction, the blogosphere needs convincing.
The BBC’s business editor Robert Peston questions whether banks can really change their habits. Indeed, some question whether a flurry of reports on banking will generate anything more than just comment.
Interestingly, another angle to be followed could be concerns that Sir David’s proposals will reduce the international competitiveness of the City. Sir David has tried to head this off already by saying ‘phooey‘ to such criticism.