Issue of the week: trouble in Threadneedle Street

What lessons should be learned from the forced resignation of the Bank of England’s deputy governor, Charlotte Hogg?

Charlotte Hogg was seen by many as Mark Carney’s obvious successor as governor of the Bank of England, said Szu Ping Chan in The Daily Telegraph. Hogg, 46, had been hand-picked by Carney in 2013 to become the Bank’s chief operating officer, and had a reputation for being his “eyes and ears”. A fortnight ago, she was promoted to deputy governor for markets and bankers. As a “bonus” for the Conservative Government, she also belonged to one of Britain’s “most blueblooded political families”. This week, however, she resigned after failing to disclose, during her entire four-year career at the BOE, that her brother, Quintin, was a director at Barclays bank; the conflict of interest was eventually wrinkled out by MPS on the Treasury Select Committee. Perhaps the “oversight” alone could have been forgiven. Damningly, “it also breached a code of conduct” that Hogg herself “had helped to write”.

Hogg was right to “jump before she was pushed”, said James Ashton in the London Evening Standard. “The Bank’s integrity is paramount.” Even so, there were those who questioned her decision. “Charlotte Hogg is a real loss to public life. Would she have gone if she had been an older man whose sister worked at a bank? I wonder…” tweeted the former chancellor George Osborne. Hogg is “clearly regarded as tremendously bright and capable”, said Deborah Orr in The Guardian, but her actions are typical of her “overprivileged” class. “They believe strongly in rules, but develop a belief that they are the people who make the rules, not the people who follow them.” British people have been railing against such privilege for “nigh on a century now”. The lesson we can take from Hogg’s “small but hugely significant” omission is that it is still very much alive and kicking.

“The kind interpretation of Charlotte Hogg’s catastrophic lapse is that she was a victim of older sibling syndrome,” said Patrick Hosking in The Times – the common assumption that the “little brother or sister you have grown up with cannot possibly rise to any responsible role in adult life”, and so needn’t be acknowledged when, say, declaring potential conflicts of interest. But, in fact, her failings were “egregious”: she “misled the Bank” on three separate occasions, and “misled Parliament, too”, by initially claiming she was in compliance with the code. Not for the first time, the Bank and its governing “court” look “naive and complacent”. A lack of curiosity, and fear of giving offence, seriously damaged the Bank in the Libor scandal, and again in the forex exchange-rigging affair. Without a drastic change in the culture in Threadneedle Street, “it will do so again”.