Barclays

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Barclays HQ, 2 Churchill Place, Canary Wharf - next to HSBC and KPMG

Barclays plc is a major global financial services company. In 2008 it was ranked as the 25th largest company in the world according to Forbes Global 2000. On Fortune Global 500, it ranked 103 in 2006, 83 in 2007, 70 in 2008, and 83 in 2009.[1]


Structure

Barclays PLC is a holding company - it operates through its subsidiary Barclays Bank PLC. Its investment banking division is called Barclays Capital.

Controversies and conflicts of interest

Use of tax havens and aggressive tax avoidance schemes

In 2011 Barclays came under intense scrutiny from politicians over its tax affairs and prolific use of tax havens. Chuka Umunna, the shadow business secretary forced Barclays to reveal in January that it had paid just £113 million of UK corporate tax in 2009, a year in which it paid £3.4 billion in bonuses, and operated more than 300 subsidiaries in tax havens worldwide, particularly in the Cayman Islands.

As a result, Barclays committed itself to committed to closing down "a significant number of Cayman companies during 2011". According to The Telegraph, filings made alongside Barclays' annual report show that in early 2012 it was in the process of liquidating 49 of those 181 Cayman subsidiaries, which would leave it with 132. The newspaper pointed out this would still leave it far ahead of other banks such as RBS and Lloyds, with 37 and 24 companies based in the Caymans respectively.[2]

Barclays also suffered embarrassment when in early 2012, HM Revenue & Customs closed down two of its tax avoidance schemes and, "in a highly unusual move, clawed back the revenues from one of them. HMRC claimed that it recovered £500 million of tax through the actions. The Telegraph described this as 'particularly awkward for Barclays because it has signed the Banking Code of Practice on Taxation, which encourages lenders to follow the spirit as well as the letter of the law. It also followed a pledge made last year by chief executive Bob Diamond for Barclays, and all banks, to win back public trust by becoming "better citizens"."[2]

Libor-fixing scandal

In June 2012, Barclays was fined a record £290 million for attempting to manipulate the London inter-bank lending rate (Libor), one of the most crucial interest rates in finance, between 2005 and 2009.[2] According to the Telegraph, investigators from the FSA and the US Commodity Futures and Trading Commission found evidence that Barclays had tried to manipulate Libor for several years in the run up to the financial crisis and in its aftermath.[3] "As early as 2005 there was evidence Barclays had tried to manipulate dollar Libor and Euribor (the eurozone's equivalent of Libor) rates at the request of its derivatives traders and other banks."[4]

During the three-year investigation into claims that Barclays and other banks attempted to inflate and suppress Libor, emails uncovered to show the extent of the scandal. "In one message sent to a Barclays employee involved in the bank’s Libor submission, a trader asked for the rate to be set “as high as possible today”, to which the unnamed staff member replied “sure”."[3]

On 27 June 2012, Barclays admitted to misconduct. The "FSA imposed a £59.5 million penalty. The US Department of Justice and the Commodity Futures Trading Commission (CFTC) imposed fines worth £102 million and £128 million respectively, forcing Barclays to pay a total of around £290 million."[4]

The scandal forced both Barclays chief executive Bob Diamond and chairman Marcus Agius to resign.[4] [5] Agius was later replaced by David Walker.

Manipulating prices

In May 2015 Barclays, Citigroup, JPMorgan and RBS were found guilty of manipulating the price of US dollar and euros and fined nearly $6 billion between them. US authorities discovered that between December 2007 and January 2013 traders at the banks had referred to themselves at 'The Cartel' in chatrooms 'where they used coded language to set benchmark rates'. During a trial period, one Barclays trader was even told 'mess this up and sleep with one eye open at night' with another Barclay's trader, in November 2010, saying 'if you ain't cheating, you ain't trying'. Barclays will pay a combined $2.3 billion (£1.5 billion) fine, which includes settlements with US and UK regulators and must fire eight employees. The bank had set aside £2 billion to cover the cost of the fines.[6]

Investment in fracking

Third Energy

Barclays owns 97 per cent percent of the gas exploration and fracking company Third Energy UK Gas Ltd [7]. Its ownership was formerly managed through Barclays Natural Resources Investments (BNRI), a private equity arm of the bank specialising in energy and commodity investments, until a management buyout in October 2015 saw the company's portfolio transferred to a new standalone company named Global Natural Resource Investments (GNRI), operating under the same staff. [8] The move meant that Barclays discontinued the right to run BNRI as its own business and would stop further investments, but GNRI would continue to manage its standing 17 investments on behalf the bank, including ownership of Third Energy UK. [9] Barclays had originally sought to sell the entire portfolio of BNRI along with its management team, but failed to secure an appropriate buyer. GNRI has an estimated $1.7 billion in standalone funds, including investments from Barclays and the Qatar Investment Authority, and has plans to raise a further $1-$1.5 billion in 2016-2017. [10]

Barclays' investment in the fracking industry has proved highly controversial, sparking strong protest from affected communities and environmental campaigners.[11] In May 2016, Third Energy was granted approval to extract shale gas at a site near Kirby Misperton in Ryedale, the first fracking operation in England since 2012. [12] The move was met with overwhelming local opposition, and increased public anger over Barclays' investment in the energy firm.

MPs on the payroll

Revolving door

  • Thomas David Guy Arculus, an independent non-executive Director from 1997 to 2006, was a member of the UK Government’s Better Regulation Task Force within the Cabinet Office from 2002 to 2005.[14]
  • Sir Richard Broadbent, the former Chairman of HM Customs & Excise, has been a Senior Independent Director at Barclays plc since 2003. He is Chairman of transport services company Arriva PLC.[15]
  • Mark Clarke, currently Director-General of Finance at the Department for Business, Enterprise and Regulatory Reform, worked at Barclays from 2000 to 2003.[16]
  • Sarah Cox of the Cabinet Office’s Business Support Group worked at Barclays plc from 2001 to 2004.[17]
  • James Duddridge, Conservative MP for Rochford and Southend East since 2005 worked at Barclays Bank 1993–2002.[18]
  • UK Life Peer Robert Fellowes, Lord Fellowes of Shotesham, was Chairman of Barclays Private Bank from 2000 until December 2009.[19][20]
  • Howell James, vice-chairman corporate affairs director, appointed summer 2008. The previous four years James was the Cabinet Office's permanent secretary for government communications, responsible for the ‘strategy, co-ordination and effectiveness’ of communications across Whitehall. He was political secretary to former Conservative prime minister John Major.[21]
  • UK Life Peer Digby Jones, Lord Jones of Birmingham, who was Minister of State for UK Trade and Investment from 2007 to 2008, was a Senior Advisor to Barclays Capital from 2006 to 2007.[22]
  • Sir Andrew Likierman, an independent non-executive Director since September 2004, was a Non-executive Director of the Bank of England and was Chief Accountancy Advisor at HM Treasury from 1993 to 2003.[23][24]
  • Francis Maude, Conservative MP for Horsham, is a member of Barclays Asia-Pacific Advisory Committee.[25]
  • Jami Miscik, who became Global Head of Sovereign Risk at Barclays Capital after it bought Lehman Brothers, was Deputy Director of Intelligence at the CIA from 2002 to 2005.[26][27]
  • Sir Anthony Reeve, Ambassador to South Africa 1991-96, was Director Barclays Private Bank Ltd, 1997–2001.[28]
  • Barclays Bank plc employee Howard Spiers was seconded to the Department for Trade and Industry from 1998 to 2001 as an export promoter.[29]
  • Robert K. Steel, a Non Executive Director of Barclays Bank plc from 2005 to 2006, was Under Secretary, Domestic Finance, U.S. Department of the Treasury from 2006 to 2008.[30][31]
  • Sir David Wright, a former British diplomat and Group Chief Executive at British Trade International, became Vice-Chairman of Barclays Capital in 2003.[32]

PR and lobbying

In February 2012 Barclays reviewed its UK public affairs contract, with Weber Shandwick and Cicero Consulting pitching for the main PA account.[33] In April PR News announced that Cicero had won the brief to handle all UK lobbying. In May 2012 Barclays was reportedly on the hunt for an EU-level public affairs agency, against the backdrop of banks facing increasing pressure from proposed EU legislation such as the potential financial transaction tax. Fleishman-Hillard currently handles the account for Barclays investment banking public affairs, and was repitching for the new consolidated account. A Barclays spokesman told PR Week: 'Barclays recently consolidated its UK agencies. We're doing the same for Barclays in Europe.'[34]

External (from June-August 2016 APPC Register):

Former

Internal

  • Matt Hammerstein - MD public policy; corporate comms; strategy and planning; and brand and marketing
  • Stephen Doherty - takes up the newly created role of MD, head of corporate comms across the bank's global business from July 2012. Doherty has been Diageo's director of comms since 2007. A source told PR Week that the appointment was a reflection of the bank’s desire to ‘get a grip on the narrative’ and provide a more robust voice in the high-profile regulatory and media debates around the global financial services industry. He will work alongside the bank's vice chairman, corporate affairs, Howell James, and will report to Matt Hammerstein.[38]
  • Howell James, vice-chairman corporate affairs director, appointed summer 2008. The previous four years James was the Cabinet Office's permanent secretary for government communications, responsible for the ‘strategy, co-ordination and effectiveness’ of communications across Whitehall. He was political secretary to former Conservative prime minister John Major.[39]
  • Alistair Smith, Head of media relations[40]
  • Jane Atkin, Corporate comms director[41]
  • Christine Farnish, Sustainability and public policy director[42]

Representation in the European Commission

Mark Gilmartin, director of Barclays Capital represents the British Bankers Association and International Swaps and Derivatives Association on the European Commission's Expert Group on automatic exchange of financial account information. The aim of the group is to assist the EU member states on tax laws and collecting the full amount of tax owed to them.[43]

People

Board members

Executive committee

Early 90s Board of Directors


CSR (Corporate Social Responsibility) Ventures (early 00's)

"Barclays is a leader in corporate citizenship and community involvement. Community support in 2001 totalled £31.1 million. ... In education, Barclays New Futures is an eight-year, £8 million programme providing opportunities for students to develop life, work and citizenship skills through partnership projects between schools and the community."[45]

"Barclays New Futures is an eight year, 8 million programme providing opportunities for students to develop life, work and citizenship skills through partnership projects between schools and the community."[46]

"In 2001, we launched a new two-year £1.9 million sponsorship programme ‘Invest and Inspire’ to promote accessibility to the arts. We are supporting major exhibitions at the British Museum, the National Gallery and Tate Britain, as well as all the productions at the Royal National Theatre’s Olivier Theatre."[47]

"Barclays also supports its employees’ enthusiastic involvement in their local communities with a range of schemes. In 2001, more than 5,300 employees volunteered their time and talents. In addition, 5,600 employees organised fundraising activities and Barclays approved more than 7,400 applications for matched funding which helped raise £5.87 million." [48]

"Barclays 1999 Environmental Review sets out the scale and scope of our practices and policies to protect the environment and conserve energy. The following is a brief summary of the Review. [...] Barclays Group Property Services has developed its own environment policy that is reviewed annually and amended to reflect technological advances, legislative developments and industry best practice. [...] We use substantial amount of paper and require suppliers to ensure that this and other raw materials are from ecologically managed sources. [...] Our branch network and head office buildings produce around 3,000 tonnes of waste paper that is recycled annually. Recycled waste paper from our Records offices totals some 4,500 tonnes each year. [...] We have some 6,000 vehicles in our fleet, all running on unleaded petrol or diesel. We do not provide free fuel for company car drivers. A cash alternative to a company car is available – around 1,300 employees have chosen this option."[49]


Affiliations

Contact

Address: Mall Level -1,
Churchill Place,
Canary Wharf,
London,
E14 5RB,
Phone: 020 7116 1000
Website: www.bank.barclays.co.uk
This article is part of the Finance Lobbying project of Spinwatch
Revolving Door.jpg This article is part of the Revolving Door project of Spinwatch.



Resources

Notes

  1. ↑ CNN, Fortune Global 500, accessed 12 April 2010.
  2. ↑ 2.0 2.1 2.2 Aldrick, Philip, "Barclays has more Cayman Islands links than RBS and Lloyds," Telegraph 15 April 2012, accessed 24 April 2012. Cite error: Invalid <ref> tag; name "Aldrick" defined multiple times with different content
  3. ↑ 3.0 3.1 Wilson, Harry, "Barclays hit with £290m fine over Libor fixing," Telegraph 27 June 2012, accessed 10 October 2012.
  4. ↑ 4.0 4.1 4.2 BBC, "Timeline: Libor-fixing scandal," BBC News 26 September 2012, accessed 10 October 2012.
  5. ↑ Telegraph, "Bob Diamond resigns as Barclays chief, Telegraph online 03 July 2012, accessed 10 October 2012.
  6. ↑ Hazel Sheffield 'If you ain't cheatin, you ain't trying': four global banks plead guilty to felony charges of fixing the price of dollar and euros Independent, 20 May 2015, accessed 21 May 2015.
  7. ↑ Emily Gosden, Barclays invests in shale gas revolution, The Telegraph, 30 November 2013, accessed 20 October 2016
  8. ↑ Joseph Cotterill, Barclays spins out resources buyout arm, Financial Times, 28 October 2015, accessed 20 October 2016.
  9. ↑ MBO at Barclays Natural Resource Investments creates new PE firm GNRI, Private Equity Wire, 28 October 2015, accessed 20 October 2016.
  10. ↑ Martin Arnold and Madison Marriage, Management to buy Barclays private equity arm after stalled sale, Financial Times, June 25 2015, accessed 20 October 2016.
  11. ↑ Tony Bosworth, Why Barclays' fracking excuses don't add up, Friends of the Earth, 13 October 2015, accessed 20 October 2016.
  12. ↑ Landmark North Yorkshire fracking operation approved, BBC News, 23 May 2016, accessed 14 September 2016.
  13. ↑ UK Parliament, Register of Members' Financial Interests, 25 November 2009, accessed 12 April 2010.
  14. ↑ Who's Who 2009, ARCULUS, Sir (Thomas) David (Guy), December 2008, accessed 24 March 2009.
  15. ↑ Barclays, Sir Richard Broadbent, accessed 13 April 2010.
  16. ↑ Financial Director, "Government FDs: who's who in government finance," 07 September 2006, accessed 13 April 2010.
  17. ↑ Who's Who 2009, COX, Sarah Elizabeth, December 2008, accessed 24 March 2009.
  18. ↑ Who's Who 2009, DUDDRIDGE, James Philip, December 2008, accessed 24 March 2009.
  19. ↑ Who's Who 2009, FELLOWES, December 2008, accessed 24 March 2009.
  20. ↑ British Library, Lord (Robert) Fellowes, accessed 13 April 2010.
  21. ↑ Public Affairs News, "Information on PA personnel moves during December 2008," People Moves December 2008 by Ian Hall, accessed 12 April 2010.
  22. ↑ Who's Who 2009, JONES OF BIRMINGHAM, December 2008, accessed 24 March 2009.
  23. ↑ Barclays, Professor Sir Andrew Likierman, accessed 13 April 2010.
  24. ↑ Who's Who 2009, LIKIERMAN, Prof. Sir (John) Andrew, accessed 24 March 2009.
  25. ↑ UK Parliament, Register of Members' Interests, 17 December 2008, accessed 13 April 2010.
  26. ↑ Sellers, Patricia, "Lehman Brothers' presidential connections," 25 November 2008, Fortune, accessed 13 April 2010.
  27. ↑ Milken Institute, Global Conference 10th Anniversary Speaker's Biography: Jami Miscik, accessed 13 April 2010.
  28. ↑ Who's Who 2009, REEVE, Sir Anthony, December 2008, accessed 24 March 2009.
  29. ↑ CFOI, Individuals on Secondment to the Department of Trade & Industry, Letter from Katharine Elliott, Department of Trade and Industry to Mr Maurice Frankel Director of the Campaign for Freedom of Information, 02 July 2001, accessed 13 April 2010.
  30. ↑ Wachovia, Wachovia Names Robert K. Steel CEO and President, Press Release 09 July 2008, accessed 13 April 2010.
  31. ↑ Business Week, Wachovia Corporation Executive Profile: Robert K. Steel, accessed 13 April 2010.
  32. ↑ Who's Who 2009, WRIGHT, Sir David (John), accessed 24 March 2009.
  33. ↑ 33.0 33.1 Cartmell, Matt, "Barclays Bank in public affairs review," PR Week 14 February 2012, accessed 10 October 2012.
  34. ↑ Cartmell, Matt, "Barclays Bank hunts for lobbying help on EU laws," PR Week 24 May 2012, accessed 07 June 2012.
  35. ↑ Register 1st September 2014 - 30th November 2014 APPC, accessed 23 February 2015
  36. ↑ Register 1st September 2014 - 30th November 2014 APPC, accessed 29 January 2015
  37. ↑ APPC, APPC Register Entry for 01 September 2010 to 31 November 2010, accessed 10 October 2012.
  38. ↑ Mattinson, Alec, "Barclays hires Diageo comms head Stephen Doherty," PR Week 20 March 2012, accessed 21 March 2012.
  39. ↑ Public Affairs News, "Information on PA personnel moves during December 2008," People Moves December 2008 by Ian Hall, accessed 12 April 2010.
  40. ↑ Brand Republic, "Banking industry Insider's Guide: UK banks' reputation managers," 03 October 2008, accessed 12 April 2010.
  41. ↑ Brand Republic, "Banking industry Insider's Guide: UK banks' reputation managers," 03 October 2008, accessed 12 April 2010.
  42. ↑ Brand Republic, "Banking industry Insider's Guide: UK banks' reputation managers," 03 October 2008, accessed 12 April 2010.
  43. ↑ European Commission Commission Expert Group on automatic exchange of financial account information, accessed 4 May 2015.
  44. ↑ 44.0 44.1 About us Leadership, Barclays, accessed 24 October 2016.
  45. ↑ Barclays, Annual Review and Summary Financial Statement 2001, Notice of Annual General Meeting 2002, accessed 12 April 2010.
  46. ↑ Greater London Authority, London Schools and the Black Child II, The Search for Solutions 2003 Conference Report, July 2004, accessed 12 April 2010.
  47. ↑ Barclays, Annual Review and Summary Financial Statement 2001, Notice of Annual General Meeting 2002, accessed 12 April 2010.
  48. ↑ Barclays, Annual Review and Summary Financial Statement 2001, Notice of Annual General Meeting 2002, accessed 12 April 2010.
  49. ↑ Barclays, a shared interest, Barclays Social Review 1999, accessed 12 April 2010.
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