Proceso de elaboración de las políticas de transparencia

CAPÍTULO III: PROPUESTA DE INVESTIGACIÓN

3.1 La Universidad Transparente

3.1.1 Proceso de elaboración de las políticas de transparencia

Entrance into the investment banking sector is commonly through a highly competitive ‘graduate scheme’ route by intellectually able candidates who may be drawn from a range of disciplines, although a numerate degree is considered useful (Jones, 1998). Other entry routes are possible for experienced hires with relevant technical skills or familiarity in a particular specialism. The bulk of formal and ‘on the job’ training is technically intensive and places employees under pressure to assimilate a large array of skills in a very short time period in comparison to other professions (Szembel, 1994). As the contemporary investment bank houses a range of specialisms employees necessarily hold a range of technical skills and performative attributes (McDowell, 1997). ‘Structuring’ services such as Foreign Exchange and Interest Rate Derivatives often require candidates educated in numerate subjects to PhD level, whereas traditional investment banking services such as Corporate Finance involve a heavy amount of client interaction and an ability to embody the organizational image (ibid). Other more frenetic areas such as Trading demand an ability to function well under pressure with rapid mental arithmetic skills.

Career paths may be plotted on the typical organizational hierarchy of Analyst, Associate, Vice-president, Director, Managing Director and Partner (Eccles &

Crane, 1987). As ‘analysts’ new entrants study financial data and company documents, create statistical models and compile reports. As they gain experience the opportunity to play a role in client negotiation increases, whilst a duty to generate client business is a substantial part of senior figures’ responsibilities. There is an emphasis on technical rather than managerial expertise, which earns financial reward and progression for revenue earners but also may result in a shortage of experienced managers (Szembel, 1994). High performers can reach senior status by their early thirties and retirement is a possible option from around the age of forty- five onwards (Courtney and Thompson, 1996).

Investment banks tend to foster an intensely meritocratic ethos (Ibarra, 1999).The necessary competencies that are assessed in relation to promotion prospects may be divided into several categories. There are those which are considered ‘cognitive’ such as strategic vision and business acumen; ‘presentational’ referring to skills of persuasion and argument; ‘motivational’ referring to enthusiasm, entrepreneurial spirit and a desire to organize others; ‘interpersonal’ which relates to communication, social skills, empathy and staff development; and ‘learning orientation’ where employees are expected to cultivate new skills, contacts and projects that could aid career development (ibid, Szembel, 1994). Formal recognition procedures therefore appear to reward proactive career progression, and in turn are likely to foster alertness to the impact of new developments upon identity formation. Moreover, many of the competencies outlined appear to possess

a performative dimension such as to communicate valuable character qualities to authority figures.

Remuneration is very high for investment bank employees compared to the majority of other professions. Since de-regulation both the opportunities for profit and intense competition have enabled unprecedented inflationary sums in this regard (Budd and Whimster,1992 [eds.]). While on average pay is twice as high in the financial sector as the rest of the UK economy, this is even more pronounced in London based financial intermediary services such as investment banking where earnings average in the range of £90k in 2006.xvi Remuneration is comprised of not only a base salary but commonly a large proportion (50%) is derived from bonuses.xvii In the financial year 2006/7, it is estimated that 4,200 City workers received bonuses in excess of £1 million.xviii These rewards are performance related which exposes employees to large variations in pay and consequently anxiety over intense inter-peer competition (Szembel, 1994). While at the bottom of the hierarchy these figures tend to be more standardised, as employees near senior level they become more discretionary and those who move between organizations are frequently lured by the offer of larger sums.

Given that employees enter banking predominantly for the financial rewards available, a high labour commodity value would constitute a significant part of identity formation. Yet this type of competitive reward structure is likely to produce concerns over how much a person is paid relative to others creating threats that

need to be managed for their impact upon perceived identity, possibly prompting remedial action to rectify suspected discrepancies. It also places great pressure on those who hold family responsibilities. Very long hours are considered customary and are often combined with overseas travel (Barnard et al, 2003; Beaverstock and Smith, 1996). It is through these systems that gender relations would present in relation to the competitive, relentless character of the New City. Some types of validated performance are more available to some than others with the effect of disadvantaging primary care givers (frequently women) whilst reproducing a perception that the committed, absent parent figure (often men) is most worthy of recognition and reward (Blair-Loy & Jacobs, 2003). Working mothers would therefore have to go to greater lengths to demonstrate their employability to those in authority as a way of overcoming stigmatisation, unlike their male or childless peers.

Market turbulence would also translate into anxiety for employees as mergers, scandals, de-layering, political events and so forth all impact employment prospects within the sector. Employment figures in investment banking organizations closely reflect market demand, with the implication that jobs are swiftly cut in the wake of a market crash to protect banks’ annual profit margins. Consultancy bodies such as Experian predict that at least 10,000 jobs will be cut in the City during 2008.xix Figure 1 below depicts the hiring fluctuations that have pervaded London’s financial sector in the last decade. This may be seen as a reflection of the trends that

have affected investment banking organizations which constitute a significant part of the broader industry:

Figure 1: Employment Trends in London’s Financial Sector, xx

(nsa – not seasonally adjusted)

The data as depicted in Figure 1 also highlights how difficult it could be for employees to hold long term plans because of the unpredictable conditions which demand continual revision of imagined career trajectories. The implications for identity formation is that which underscores the precariousness that individuals experience in the course of their career, necessitating quick and effective responses to each change of circumstance.

Summary

Following earlier proposals on how the changes that the City has witnessed merits a study of identity formation which is attentive to these developments, this chapter has developed this argument through looking at the organizational systems that comprise investment banking. Investment banks may be distinguished from other professions in a number of ways. Principal amongst these is the level of

contingency that employees operate with, devoid of a stable knowledge base, immersed in the context of financial markets that offer potentially vast profits but are inherently unpredictable. Combined with an intensely meritocratic ethos and truncated ‘up or out’ career paths, this places a burden on employees to capitalise on the resources at their disposal to construct an identity, which may be highly diverse given the variegated and evolving nature of the environment.

The features of contemporary banking organizations outlined also suggest how identity formation may necessitate the accommodation of a range of performances over the course of a career. This may occur either as part of adjustment to an interruption such as redundancy; updating in line with a new product or market trend; improvisation of demeanours throughout interactions characterised by doubt; or as part of moving rapidly upwards or across into a different specialism. In turn this would require that actors reflexively integrate these images into an ongoing biographical account in such a way which is internally referential, enabling an important sense of coherence in terms of how they perceive themselves over space and time (Giddens, 1991 p. 58).

Financial Services Authority Policy Document, ‘Code of Market Conduct’

http://www.fsa.gov.uk/pubs/policy/ps59_76.pdf last accessed 12 Mar 2008