Most people are heading to the hills for the long weekend,
so I’ll keep this brief.

There seems quite a buzz around the Senior Managers’ Regime (SMR)
in the UK, specifically how people – well used to playing this game – are
seeking to pass the buck more often than a children’s game of Pass the Parcel.

Normally I would suggest this shows a lack of responsibility
on the part of people who are well paid to take it on, but in the case of the
SMR I am less convinced because it either has not been written clearly enough
or it’s just a bad piece of legislation (could be both of course!)

The latest recipient of the aforementioned buck is the
technology team, for more and more people are talking to me about how they are
going to implement the SMR using technology to monitor activities. This is fine
and obviously will help most of the time, but it also means, according to some,
that if some rogue activity takes place and it isn’t picked up by the tech
surveillance, then the heads of the tech team will be responsible.

This strikes me as nonsense to the nth degree because they
don’t have direct responsibility for the business lines, they are merely there
to oversee the technology. It is suggested, however, that the technology is
explicitly there to find the misconduct so if there is any of the latter then
the tech would have failed etc etc etc.

The first thought is obvious – who would want that job? The
second is equally so – this smacks of senior managers trying to evade their
responsibility.

But if the regulation is unclear or badly written, and the
very fact that this buck-passing is taking place suggests it is, then perhaps
there is a case for a re-think on the rules? Few get things right first time,
including regulation writers, so perhaps the second draft will be more
workable? As things stand it seems to me we are creating grey areas where they
need not exist – better scripted regulations can deal with that. Of course,
even as I am writing this in my mind I am thinking, “people are playing silly
political games”, which is, as we all know, nothing new, especially in the
institutional world.

I do believe we need perspective, however, and must take
some of the fear out of this issue. Rogue employees are a statistical
certainty, and if they can be found early then all well and good. They are
going to exist and misconduct will occur, though, so perhaps if we had
proportional responses to different offences we would not have to witness this
rather unsavoury game taking place?

This column will return next Thursday.

Colin_lambert@profit-loss.com

Twitter @lamboPnL

Twitter @Profit_and_Loss

Colin Lambert

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