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Barclays boss fights to win trust
It could take up to a decade for Barclays to regain customer trust after a series of scandals that have beset the bank, its chief executive has said .
Antony Jenkins, who took over the reins of Barclays in August in the wake of the Libor scandal and who was guest-editing BBC Radio 4's Today programme, said he was determined to change the culture at the bank towards long-term sustainability.
Mr Jenkins said: "Trust is a very easy thing to lose, and a very hard thing to win back.
"In my view it will takes several years - probably five to 10 - to rebuild trust in Barclays."
Barclays was the first bank to admit traders manipulated interest lending rates and was slapped with a £290 million fine 18 months ago. It was also caught up in the PPI mis-selling scandal.
Mr Jenkins, formerly head of the retail banking arm at the bank, hinted at a long-term strategy to overhaul the bank in September, pledging to restore Barclay's shattered reputation.
As Today's guest editor, he chose to focus on leadership and the "importance of long-term thinking".
He said: "My point is not that short-term markets are bad or inaccurate. They serve a very useful purpose. It is susceptible to elevator analysis - this is up, this is down.
"In addition to looking at the short term and what that tells us, how do we focus on longer-term drivers of the economy?"
London School of Economics economist John Kay told the programme that the banks "by the way they have behaved over the last 20 years" have systematically destroyed their relationship with their customers, with management setting up "misaligned incentives" that effectively pay corrupt bankers.
Mr Kay said he was not particularly optimistic about the future of the banking sector.
"We're starting to have the right debate but we're quite a long way from understanding how corrupt parts of the financial services sector had become or in rethinking the ways in which we approach business," he said.
Mr Jenkins said he agreed with much of the economist's comments, but he said that under the right leadership banks still had the ability to redeem themselves from past failures.
"In my view, leadership sets the culture in big organisations and culture drives organisational performance.
"If you want a different sort of organisational performance, a more ethical business, you're going to have to change culture. Culture takes time to change and it comes back to leadership. If you take a long-term perspective, you'll build the right culture," said Mr Jenkins.
"I can only be responsible for Barclays but I'm hoping in what we do at Barclays we can also rebuild trust in banking."
Archbishop of Canterbury Justin Welby was invited on as a guest speaker, as part of the Barclays chief's leadership-themed edition of the programme.
Mr Jenkins revealed the two had discussed the subject of "good banks" at St Paul's Cathedral in the summer, suggesting they both shared similar values and visions for the banking sector.
He said: "Afterwards, we were talking about the sort of leadership challenges that we were facing, both being relatively new in our jobs, and I was struck by the similarities of changing large organisations in whatever sphere they operate in."
Mr Jenkins was particularly struck by Archbishop Welby's comments that "good vicars" result in "growing congregations".
"That's all about leadership, whether it's in a parish, in a school, in a business. Then you get success, so that was part of it," said Mr Jenkins.
Mr Jenkins also said banks had a "strong obligation to society" in the way they go about their business.
"Another thing that struck me was how close our views are on where banks need to go. Banks are different to other commercial enterprises, they sit right at the heart of the economies where they do business.
"Without vibrant banks you cannot have vibrant economies, without vibrant economies you can't have growing and stable and fair societies.
"And so banks have to recognise that they have a strong obligation to society to do business in the right way, as well as serve their shareholders and customers," he said.
Mr Welby, who is a member of the Parliamentary Banking Standards Commission, also said changing the culture of the banks would take time.
"People like Antony (Jenkins) are dealing with the impact of 30 years, I think, in which there was strong pressure to go in one direction, which was about maximising shareholder return and a progressive - not instant - but progressive loss of vision as to what banks were for in society," he said.
"No company, or no economy exists solely for itself, it exists for the common good, for the flourishing of human beings.
"The challenge for leadership is to change that culture - that says we are not here just for ourselves, we are here for the whole of society and that is a massive, massive challenge and will take a very long time to turn around.
"I have no illusions about how to difficult it is to do that."
He said he thought a number of the banks were doing this.
"Barclays are working very hard at it and the major banks are working very hard at it. I don't want to name names but I came across some people recently who were very clear - senior members of the City from foreign organisations - but who were very clearly still absolutely in denial about what happened in 2008."