On management succession, the LSE’S stock has slumped

Comment Martin Flanagan

Nothing succeeds like success. Not always, it seems the adage has certainly given the London Stock Exchange a miss. By general consent, the LSE’S French-born boss Xavier Rolet has had a distinguished eight-year tenure, even if blemished at the denouement by a failure to consummate a merger with Germany’s Deutsche Boerse. Otherwise, he has overseen stellar expansion, financial success and strategic surefootedness at the London exchange. But nothing has become Rolet less than his leaving of the post.

First, he announced he was departing by the end of 2018, apparently having fallen out with LSE chairman Donald Brydon in a big way. Then the activist investor The Children’s Investment Fund threw a spanner in the works by demanding Brydon’s scalp instead and Rolet’s reinstatement.

Now the chief executive has concentrated everybody’s minds, and perhaps compunction, by saying he will step down with immediate effect and not return to the LSE under any circumstances. For good measure, the hapless Brydon has said he himself will not stand for re-election in 2019 to make way for a completely new duo at the helm.

As one of my former news editors (not at The Scotsman) would sometimes say after a dysfunctional day in the newsroom, don’t you just love it when a plan comes together?

Take in Royal Bank of Scotland, Natwest, HSBC and the other big lenders and the song remains vaguely Orwellian: “Four legs” digital banking, good. “Two legs” branch banking, bad. My local branch in central London – no names, no pack drill, you never know when I might need it – seems to employ meeters and greeters on the door whose only purpose is apparently to forestall me going to the counter and then tell me to have a nice day.

The other weirdness of the digital banking revolution is the advertising. People always seem to be smiling at their mobile phones as if it is not only a superior channel but they somehow have more money, too.