The IoD City Property SIG chair, Richard Nelson, engages with Bob Wylie, author of Bandit Capitalism: Carillion and the Corruption of the British State, and Amin Aboushagor, the IoD’s Policy Advisor, Corporate Governance, to explore the state of governance in the property and construction sector today, and what we can (finally) learn from past lessons.
To give you some perspective of the issues, here is the publisher’s precis about Bob’s book:
The collapse in January 2018 of the construction giant Carillion, outsourcer of huge Government building contracts, is one of the great financial scandals of modern times. When it folded it had only £29 million in the bank and debts and other liabilities adding up to a staggering £7 billion. When the total losses were counted it was established that the banks were owed £1.3 billion in loans and that there was a hole in the pension fund of £2.6 billion. That left British taxpayers picking up the tab to salvage the pensions owed to Carillion workers.
On one level, this is a familiar story of directors who systematically looted a company with the aim of their own enrichment. But in a wider context the Carillion catastrophe exposes everything that is wrong about the state we are in now – the free-for-all of company laws which govern directors’ dealings, the toothless regulators, the crime and very little punishment of the Big Four auditors, and a government which is a prisoner of a broken model born of a political ideology which it cannot forsake. Through the story of Carillion, Bob Wylie exposes the lawlessness of contemporary capitalism that is facilitated by hapless politicians, and gives a warning for the future that must be heeded. Bandit Capitalism charts, in jaw-dropping detail, the rise and rise of the British Oligarchy.