Private ethics and public conflicts

Recently a senior civil servant who was chief of shareholder investment section in the Department of Finance left his position to take up a new job. He was in charge of the Department’s (the public’s) policy and enforcement of the banking regulations and agreements. His new job however, is with the Bank of Ireland, part of the senior management team there. High level movement between public and private sectors has been a growing trend over the past number of years and has benefits in many respects. The poacher turned game-keeper story has certain advantages. This particular move however, raises more than a few disturbing questions.

Obviously, the BoI now have access to the insider thinking of the Department’s plans for the future of the banking sector. There must surely be a conflict of interest here. The civil servant in question can’t be expected to ‘un-know’ what he knows. This is not just a issue of personal ethics but has implications for the public also. The insider knowledge he has and at least some of what is contained inside this guy’s head has been paid for out of  the public purse and for the benefit of the public. Allowing him to decamp to make a huge personal gain with that information, with no strings attached, is questionable ethically and socially irresponsible. The fact that this information could now be used against the public interest and in favour of the BoI is frankly outrageous.

Another problem is that as a civil servant, he was privy to some very sensitive, competitive information from all the banks involved in recapitalisation? So he brings to the BoI this information on their direct competitors – albeit that the state owns most of these banks anyway! Why are these banks not screaming blue murder about this potential compromise of their positions?

The notion of a ‘cosy cartel’ has often been identified as a problem, when apportioning blame and coming to grips with the breakdown of financial services and regulations in this country. It seems to me as if this problem continues and any hopes of cleaning up our act or witnessing a shift in how we do business is as far away as ever. Sustainability is about openness and transparency, about a new social contract for how business is conducted and how we organise our society for the benefit of all. These practices are not sustainable. They will not lead to a more sustainable future.

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