I’m beginning to think national scandals are on the way to becoming legitimate commodities, available to be traded on some sort of media-owned (Murdoch-owned?) ‘Scandal Market’. They could be priced according to the analyst’s ranking of key indicators, such as the ‘contractual bonuses paid to fat-cat overseers caught with their hands in the cookie jar index’, or the ‘double standards of the great-and-the-good gradient’. Factor in the number and seniority of ‘shocked’ politicians in damage limitation mode and, of course, the likely degree of public outrage, and we’ve got a winner.

Here in the UK we recently sidelined the Savile Scandal for the LIBOR Scandal before diving headlong into the Horsemeat Scandal, the purveyors of which were no doubt praying for another choice shocker to come along and divert public attention from their own miserable backtracking. They didn’t have long to wait: the resignation and public ‘apology’ of Cardinal O’Brien (part of the the ongoing Meta-Scandal that is the Catholic Church) stole the front page before you could say ‘inappropriate fumblings’.

Meanwhile, back at the LIBOR Ranch, giants of the banking industry have been telling us – in broad brush terms, naturally – of the changes required to ensure this sort of thing never happens again. Top of the fix-list: culture. Anyone familiar with the literature will know what an uphill climb that will be. While we’re waiting for this miracle, we’re informed that the current problems have been fixed and controls strengthened. The ripening whiff of ‘trust us’ once again lingers in the air.

Funnily enough I don’t buy it. Most people I speak to don’t buy it either. Here’s why:

From the perspective of operational risk, managing a process – such as LIBOR – follows an understood set of principles: in a nutshell, identify the critical business activities, understand the associated risks and take steps to control them.

The key is the first step: identify the critical activities. If this isn’t done, you’ll not be looking at the right things. If you’re not looking at the right things, you’ll not be controlling what needs to be controlled. This is what I think of as The First Rule of Why Bad Stuff Happens, which states: ‘bad stuff happens when we’re looking the wrong way’.

Were those LIBOR-guilty organisations looking the wrong way? I can’t say for sure, but it’s one possibility and, I would venture, quite likely.

The thing is, this widely publicised desire to address cultural issues – while laudable – is a bit too nebulous to get to the real fix and asks more questions than it answers. You could get away with this in the past when the principles of risk management and corporate governance were not so focussed. Today, something more concrete is required: a starting point might be to convince us that our organisations are looking the right way.