Sir Sandy Crombie is the Senior Independent Director at RBS and Vice Chairman of the Royal Conservatoire of Scotland. Prior to this, Sir Sandy was Chief Executive of Standard Life, a Director at the ABI, Chairman of Creative Scotland and of the Edinburgh UNESCO City of Literature Trust.
I’d make sure that all boards were crystal clear on their organisation’s vision and higher purpose. Boards shouldn’t be satisfied with strategies that only address today’s issues. We need to be building businesses for future conditions.
Boards should also be clear on their business’s identity – what makes it unique and the values the organisation stands for.
The board needs to ensure that good aspects of culture survive generational change and recognise that the best way to affect culture is by being very deliberate with their CEO appointments. The person at the helm must share the same values as the board.
Absolutely. The 2008 crisis was a wake-up call for boards, particularly for those in financial services. Gone are the days where anyone would dare turn up to a meeting without having opened the board pack. There’s too much at stake, for both your own reputation and that of the business.
That said, it’s not a perfect world and we need to recognise there’s no such thing as a zero failure regime. Companies shouldn’t fail, but if they are not up to it, they should disappear. And it’s up to the regulators to make failures less likely, not to create an environment where no sane person would want to be a non-executive.
The most important thing for me is that it ties into the organisation’s vision and higher purpose. I want my board pack to give me that wider context and to link to our long-term goal, so I can see how our actions today will support the future we're trying to build.
In terms of style, bullet points and long chunks of narrative are a big no for me. But no matter how well an individual paper is written, if the whole pack nears 2000 pages it’s going to be a struggle to digest the key messages. Management need to exercise judgement and discipline in working out what information the board really needs to know.
Our global influence is less important than our global competitiveness. What matters isn’t if we’re worldwide, but if we’re world class.
There’s no reason why our businesses can’t be a gold standard. But being best by local standards won't protect against those achieving a higher international standard.
Two decisions stand out from my time at Standard Life. Firstly, our decision more than 20 years ago to put the customer first. And secondly, the choices we made to de-risk the balance sheet.
In 1994 we rolled out our Total Customer Satisfaction initiative. We took everyone off site for two days to really explore what we meant by our three driving principles and six values, and then we went back to work and identified everything inconsistent with these. It was an incredibly powerful exercise. It created a bottom-up revolution and those principles and values are still fundamental to how the business runs 20 years on.
The other decision was around how to transform Standard Life from a cash-consuming mutual to a cash-generative Plc. We focused on what we were good at – an asset management business with operational excellence and a workforce who understood the customer. We sailed through the subsequent financial crisis and one analyst report in 2009 described us as ‘reassuringly dull’ – never were such a description so complimentary!
C J Samson’s Sovereign. It’s the third book in the Shardlake series which was recommended to me through the Edinburgh UNESCO City of Literature Trust. I had been doing a crime tour through Scotland and as a fellow Scot, Samson’s books were mentioned as a good murder mystery to get my teeth into.
Do the right thing.
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