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Attention: what banks can learn from the Army

25 September 2015

The article at a glance

When it comes to building trust, the British Army could hold some valuable lessons. What do banks and the British Army have …

When it comes to building trust, the British Army could hold some valuable lessons.

British guardsmen in traditional red tunics and bearskin hats, on parade in London

What do banks and the British Army have in common? Not much on the face of it, but as banks battle to restore trust, there may be one or two things they can learn from the men and women serving their country at home and abroad.

“Trust is the very DNA of the British Army and at the heart of everything it does,” says Tim McEwan, a former British Army Officer and leadership instructor at the Royal Military Academy Sandhurst. “And that trust operates from the very bottom rung not only to the top of the military, but to the wider nation beyond.”

It’s a lesson that banks could well take note of, but the first thing to understand is why trust is important. McEwan points out that a platoon of young soldiers, led by an equally young officer straight out of Sandhurst, is implicitly putting a lot of faith in the institution that trained them, on the basis that they are trusting their leader to be competent and do the right thing.

“Most of all, they are trusting that person to create a robust plan – so that when they get deployed on a dangerous operation in a hostile environment, they know that plan is sound. Those soldiers trust that their leaders have their best interests at heart, knowing that they have fought your corner, questioned, challenged, had conversations with their superiors on your behalf.”

But trust goes both ways. A commander trusts those soldiers to use their initiative and do their job to the best of their ability, says McEwan. “You have to trust that the soldiers will ‘do the right thing’ – you can’t be everywhere, all the time,” he says. “And as that two-way relationship extends all the way up the chain of command the principles remain exactly the same – just with increased numbers and a more complex environment.”

Trust also extends outwards to other players – in the Army’s case, to NGOs, aid organisations and communicators such as CNN or the BBC. It goes further still to what is referred to as the “military covenant” between the Army and the nation. As McEwan says: “The British people trust the Army to defend our shores and what we stand for. The quid pro quo is that the nation will look after the services’ men and women and their families, the notion being: ‘You are protecting us, so we will protect you.’ The Armed Forces need to trust that this covenant will be upheld.”

But how do you build that trust in the first place? Put simply, you behave in a way that demonstrates you are worthy of it. The Army does this by living and breathing its values.

“Everyone fails sometimes, and people must be given the chance to try again, to develop,” says McEwan. “But the one thing guaranteed to get you kicked out of training at the Royal Military Academy Sandhurst is to breach its values – if your integrity is brought into question or you’re in it for yourself rather than the team, you’re out. Trust in itself isn’t a value but it does build from people adhering to values. Anywhere I go in the world, even now, and meet someone in the British Army, a bond of trust immediately exists because I know they have a shared set of values.

“Sandhurst’s motto is ‘serve to lead’ and engendering trust also means, as a commander, you put your soldiers’ every need ahead of your own. You empathise with their situation, you make sure they understand the context, and purpose, of what they are doing, and you give them the technical means and all the personal support they need to do it. The fact that officers always eat last – having ensured all their soldiers have enough food – is not just a nice tradition, it reinforces the very real belief that leaders put their people first. As Plato said: ‘He who is not a good servant will not be a good master’.”

McEwan, who now runs his own leadership consultancy and is a Cambridge Judge Business School fellow working with the School’s Executive Education function, believes that trust needs to be rebuilt in financial services organisations and that the public should support them in their efforts to do so. And he points to the compliance function as a great place to start to rebuild that trust. “The compliance officer should be a trusted adviser, but has in the past been seen as a rule-based policeman who is always an afterthought.

“But you can’t make that journey to trusted adviser overnight. Compliance in general has to create a culture that demonstrates not only competence, which should be expected, but also confidence – confidence to take on the role of a trusted advisor and all that it entails, so that people can see that compliance has the best interests of the organisation at heart and is prepared to work in different ways to prove it.

“Once again it’s about doing the right thing,” he says. “There’s a world of difference between doing the right thing – using your judgment – and doing things right, which means following the rules.”

Whether in the Army, the banking industry, or in any organisation, trust doesn’t just happen. “You have to demonstrate that you are worthy of people’s trust through your actions. Trust builds from individuals into an organisational culture where trust is in its very DNA, as the British Army has. If our banks and financial institutions can build that culture and demonstrate their worthiness then we will get back to a place where the bank manager is once again a pillar of the community’s trust.”

This subject was addressed at Cambridge Judge Business School’s Trust in Banking conference in the panel session: “The role of leadership in building trustworthiness”, featuring General Sir Peter Wall GCB CBE, Director, Amicus and former Chief of the General Staff of the British Army. The event took place at the London Stock Exchange on 20 October 2015.

Visit Tim McEwan’s fellows profile


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