The chairman is sceptical about education improving financial services, as, he says, good intent will founder on the rock of human nature – just like a television chef’s attempt to ‘improve’ people’s diet.”Can I be the only one who finds it implausible she’s the sort of person who just loves the concept that interest is added daily?” asked the chairman of the impurely-sized investment company Second Coming Asset Management as we enjoyed a pint or two of Plunging Neckline at The Come-Hither Look. “To put it another way, is it unfair of me to wonder if she even knows what interest is?””That would be very unfair of you indeed,” I replied. “I’d say it was highly possible she just loves the concept that interest is added daily although I’d qualify that by suspecting, in a list of concepts she just loves, the concept of interest might come a little way behind the concept of sparkly necklaces, the concept of minimal-clumping mascara and the concept of a nice fee for a day’s modelling.
“But, you see, maybe even I’m being unfair in thinking that. For all you and I know she may one of the 23,000 holders of financial services qualifications at degree level or the 80,000 students in 100 different countries who have the ifs School of Finance to thank for their at-oneness with interest and no doubt many other concepts to boot.”
“I fear this conversation has taken an unexpected twist,” said the chairman. “Why are we talking about the mob at ifs?” “Because they have circulated the rallying cry that it is education that can restore confidence in financial services,” I replied. “Well, the law of averages says something must,” the chairman observed. “Why shouldn’t it be education?””That’s certainly an argument – I think,” I said. “At least, it’s the basis of the ifs thesis, which runs that while nobody can make assumptions about the final shape and structure of the financial services sector, one certainty is that education and good practice will be critical to rebuilding a sustainable financial services industry.
“And, of course, we know such an argument has to be a jolly good one because, well, it gets trotted out every time Her Majesty’s financial services industry shoots itself in the foot, which is more often than any of us should feel comfortable about. Still, credit where it is due, the good, good people at ifs have developed the idea a little further than usual.
“So they define the fundamental principles of banking and financial advice as including fairness to customers, giving them the protection and security they need; protecting institutions and shareholders from poor risk-taking decisions; providing confidence to regulators and policy makers that best practice is being followed; and rebuilding trust – not just in the retail market but at every level of the industry.”
“Wow,” said the chairman. “That would be a feat worthy of FDR – or even the legend-in-waiting that is Gordon Brown. Any indication as to how they will go about pulling it off?” “Would you be surprised if I told you it all centred on education?” I replied. “But that’s education across the board – consumers, sales staff, customer advisers, financial managers and even industry leaders.”
“No mention of education for regulators?” the chairman asked. “Oddly enough, I assumed they might be included within the leaders category,” I said. “Sorry – don’t know what I can have been thinking. Still, what do you think of ifs’, ahem, concept?” “Most laudable,” the chairman replied. “Though I fear, as ever, it may founder on the traditional rock of human nature.
“People are forever calling for more financial education. It’s just that hardly anybody’s that interested in getting any. It’s like people enthusiastically appearing in young Oliver’s Ministry of Food programme and then heading home for chips – or nationalistic Scots claiming it’s their oil but staying strangely quiet on the subject of RBS or HBOS debt.”
“Or like Scam always launching a fund when its investment arena’s already up 80%?” I suggested. “Or like you always drafting in a fantasy football striker after he’s scored five goals in four matches and will never score again?” the chairman replied. “Touché,” I nodded. “Still, maybe it’ll be different this time.” “Ah,” said the chairman. “The most dangerous words – or concept – in financial services.”