Profit not satanic; bonus pay crucial to retain talent, says Barclays CEO

Font Size

Print

Feedback

Email

Discuss

Related Articles

Female bosses get thumbs down from shareholders

: Barclays Plc chief executive officer John Varley stood at the wooden lectern in St Martin-in-the- Fields on London’s Trafalgar Square last night and told the packed pews of the church that “profit is not satanic.”

The 53-year-old head of Britain’s second-biggest bank said banks are the “backbone” of the economy. Rewarding high- performing bankers with more pay doesn’t conflict with Christian values, he said. Varley was paid £1.08 million ($1.77 million) and no bonus in 2008. “Talent is highly mobile,” Varley, a Catholic, said. “If we fail to pay or are constrained from paying competitive rates then that talent will move to another employer.” “Is Christianity and banking compatible? Yes,” he said in an interview after the speech in the 283-year-old church. “And is Christianity and fair reward compatible? Yes.”

Varley joins Goldman Sachs International adviser Brian Griffiths and Lazard International chairman Ken Costa as London bankers who’ve gone into London churches in recent weeks and invoked Christianity to defend a banking system that critics say has created wealth and inequality in the UK. “The injunction of Jesus to love others as ourselves is an endorsement of self-interest,” Goldman’s Griffiths said on October 20. “We have to tolerate the inequality as a way to achieving greater prosperity and opportunity for all.”

City bonuses may rise by 50% to 6 billion pounds this year, according to the Centre for Economics & Business Research Ltd, even after the UK economy contracted for six consecutive quarters, driving unemployment to a 14-year high of 7.9%. The gap between rich and poor in the UK reached its widest in five decades last year, according to the Institute for Fiscal Studies, a non-partisan research group.

“The levels of inequality in London are just mind-boggling,” said Nicholas Sagovsky, canon theologian at the 764- year-old Westminster Abbey, where British monarchs are crowned. Bankers are trying to defuse public anger at a financial crisis that triggered a state bailout of lenders including Lloyds Banking Group Plc and Royal Bank of Scotland Group Plc. The two banks yesterday got 31.3 billion pounds more from the government, after receiving £37 billion last year. “It’s terrible to say things like that in a church,” Neil Jameson, executive director of London Citizens, a non-profit that campaigns on issues from low pay to crime, said of Goldman’s Griffiths. “He should be condemned,” Jameson said.