A chara, – A significant assertion was made by Laurence Crowley (Una McCaffrey, Business This Week, September 2nd): “I’ve always believed that a key influencer in an organisation is not how much people are paid but what they’re rewarded for”.
He says this in the context of arguing that the cap on the pay of chief executives in State-guaranteed banks should be raised to €750,000. He is less forthcoming when he offers no suggestion (at least in the interview as reported) on what “rewards” those bankers should receive whose decisions and policies led to the collapse. – Yours, etc,
Sir, – The interview with Lawrence Crowley (September 2nd) provides an interesting insight on the composition of Irish bank boards. He explained that boards are wary of selecting whom they do not know for fear of risking “the cohesiveness of the board”.
The Irish banks ran into trouble by abandoning traditional lending values and indulging in reckless property lending, sanctioned by their management, but not detected by their boards. The Nyberg report blamed this on “Groupthink.” Is this not what happens when board appointments are made on the basis of cohesiveness? – Yours, etc,