The City’s top feminist? Lloyds CEO Antonio Horta-Osório on his plans for the bank

Lloyds plans to give 1,000 women top jobs and turn the bank into a family-friendly haven. Boss Antonio Horta-Osório talks stress and the sexes with James Ashton
Gift: Lloyds boss Antonio Horta-Osorio Picture:Daniel Hambury/Stella Pictures
5 March 2014

Antonio Horta-Osório’s style is to lead by example. It was nearly his undoing, when the hitherto insuperable Portuguese banker at the helm of state-rescued Lloyds Bank was signed off for six weeks with exhaustion — the City’s most high-profile case of sick leave.

Two years on, he’s at it again. Lloyds is in far better shape financially and on course to be returned fully to the public markets but Horta-Osório already has his mind focused on the next task in hand. Can he shake up the culture of the bank and win back trust from a doubting public?

“I want — as I always do, by the way — to lead this by example,” he says, accepting a cup of green tea as he settles down in one of Lloyds’ many beige meeting rooms in its Gresham Street base. He is talking about the most eye-catching pledge contained in a manifesto of public commitments the bank is publishing today under the ambitious banner of Helping Britain Prosper.

When most companies are fighting shy of imposing quotas to rebalance their leadership away from white middle-aged men, Lloyds is pledging to add close to 1,000 extra women to its top tier of 8,000 managers by 2020. For his part, Horta-Osório will mentor three senior women who have the potential to reach the bank’s executive committee.

“I think it’s very important, not only for them but also in terms of signalling throughout the organisation that I would like more people and more of my colleagues to help,” he says, sporting a light tan and hair slicked back, with eye contact even firmer than his handshake that confirms one of the City’s alpha males is in the room.

There is more. Since the beginning of the year, Lloyds has decreed that for every available senior role it will aim to put forward at least one woman as a candidate for the job.

“It is very important that everything should be meritocratic and based on performance,” Horta-Osório adds. “I am absolutely sure all the women we are hiring and promoting would not like it any other way.”

Lloyds also aims to “unlock the obstacles” that stand in women’s way, by examining how the bank manages maternity leave and flexible working hours.

But is it really possible to combine a high-pressure City career with a sensible work-life balance? It was hard at first for Horta-Osório, who was poached from Santander to lead a Lloyds turnaround three years ago, only to be diagnosed with sleep deprivation by the autumn. He has delegated more since then but that is a function of Lloyds sailing into less choppy waters — reporting a statutory profit of

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£415 million after several years of losses since its disastrous merger with HBOS and £20 billion taxpayer bailout.

“When you are in a sizeable turnaround you have to devote all your energy to not allowing the boat to sink and to put it in good shape,” he explains. “That requires a more centralised approach to management because you are under pressure. Like we used to say in Portugal, in times of war, you don’t clean weapons.”

You might guess that his favourite book is The Art of War, by Sun Tzu, after he happened upon a copy while he was on honeymoon.

Further down Lloyds, “a normal bank, a boring retail and commercial bank” as he puts it, there is little or no investment banking or trading activities, which means striking a balance should be possible. “In that sense, it is easier to balance work pressures with personal life than obviously in a trading environment.”

Lloyds’ Helping Britain Prosper targets also include bankrolling one in five start-up businesses and one in four first-time buyers by 2017, as well as increasing small-business lending by £1 billion a year.

“We are putting everything together in a plan that can be monitored and where every senior executive of the bank will be accountable. It will also help to shape the culture we want, which is a culture of trust with our customers and a culture of helping communities.”

That is a crucial point: returning Lloyds to financial health was tough enough, and its progress has thrown Royal Bank of Scotland’s travails into sharp relief. It has still proved far easier than banks regaining the trust of the public. For example, in its last set of results Lloyds flagged that it was ready to restart the dividend later this year and for the Government to sell down more of its 33 per cent stake but that it was still grappling with the fallout from the payment protection insurance mis-selling scandal.

At Lloyds, Horta-Osório bit the bullet soon after he arrived. The cost to the bank is an eye-watering £10 billion and rising, with 6,000 people still processing claims. But a blacker mark is the £28 million fine for dubious sales

tactics where branch staff were offered “grand in your hand” bonuses to push income protection policies on unsuspecting customers, which carried on further into his reign.

“Obviously, those are legacy issues which we tried to stop as soon as we came into the bank, but when you have a 100,000-person organisation and you want to change culture, those things take time,” he says.

Then there is the knotty issue of remuneration. Lloyds’ annual report is also out today, confirming Horta-Osório bagged a £1.7 million bonus for the year. After huge job cuts, it is a figure that ruffled feathers in some quarters — even though its long deferral means Horta-Osorio has to wait until 2019 to get his hands on it.

Lloyds is also paying “allowances” to executives to top up salaries because a European Union directive has capped bonuses at one-times salary. At the same time, the bank is following HSBC and others in asking permission from shareholders to let it double the bonus ceiling. Last year, its bonus pool grew £30 million to £395 million and 27 staff earned more than 1 million — a fraction of the bumper pay on show at more international banks such as Barclays.

Now some politicians are calling on share-based pay to be deferred for a decade. But where Horta-Osório has led in some areas, he wants to be a “follower” on this matter.

“I think we will see how things evolve. We will take decisions then but we have already taken the lead in going to five years,” he says.

After running banks in Brazil and Portugal, Horta-Osório, 50, who speaks six languages, has embraced London life with his wife Ana and three children over the past eight years. The family is a testament to a globetrotting career. His two daughters, aged 22 and 18, were born in New York and Portugal, while his son, aged 15, arrived when the family was based in São Paulo. Now they live in Chelsea and he has grown sanguine about the weather.

“It rained in Brazil too,” he says with a laugh. Horta-Osório’s competitive streak extends to his love of tennis, which he plays at Queen’s Club. His father was a table tennis champion so it’s in the blood but doctors told Horta- Osório that he would never play tennis again after breaking his right wrist at the age of 30. He promptly taught himself to play left-handed but reverted to right-handed again two years later. And then there is the scuba diving, twice a year if possible, often with sharks.

“London is a fantastic place to do business: the fact that you have this vibrant city full of different nationalities and companies from all over the world is a clear demonstration of that.” But coping with the drizzle is nothing compared to linking his bank’s prosperity with that of the nation.

“You cannot have a strong economy without a healthy banking sector, and a healthy banking sector requires a strong economy. The future of both are inextricably linked.”

Will Britain buy banking as a force for good and a fair employer? One thing’s for sure: in trying to convince the doubters, Horta-Osório is driven to lead by example.

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