Stan Chart’s apprentices to tear down banking shibboleths
Standard Chartered’s mould-breaking front office apprenticeship scheme is to be lauded. The programme stands to supply the City not just with a new breed of banker but, if handled well, could bring that rarest of commodities to high finance — genuine diversity.
The UK bank welcomed its first cohort of apprentices on Monday. Stan Chart says it assessed applicants to its Financial Markets Apprenticeship Programme through “materials developed specifically for the role, enabling a holistic view of candidates’ ability” rather than screening by way of “an academic qualification prerequisite”, presumably a degree.
It is a revolutionary move. Banks have spent the last few decades recruiting almost solely the cream of the academic crop — high achievers from elite universities and business schools. Before that, of course, there were the famous East End barrow boys of the ‘80s and ‘90s, plenty of whom, despite the moniker, had probably never been near the sell-side of a market stall, but who converted their street smarts into financial acumen, working their way from back to front office.
To look at your average trading floor, you might wonder whether they are already places of opportunity and diversity. Various nationalities compete in what is something of a global jobs market.
Of course, not every investment banker went to a private school followed by Oxbridge or the Ivy League. But very many did.
And really, how diverse is a bank’s staff when so many have had a similar education at an elite university — not forgetting that those institutions will have more likely recruited from wealthier, better connected families than from rank outsiders — and before that an elite school, and all live in the same well-heeled parts of town?
It is not that banks haven’t been aware of the problem of recruitment based solely on a strong academic record. One senior derivatives trader in New York remarked that while he was flooded with applications from students at top French universities who had peerless quantitative skills, he struggled to find enough of them that could hold a conversation with another human, or maintain any duration of eye contact.
Indeed, your own correspondent was not altogether encouraged many years ago in a final round interview for a junior job on a derivatives desk at a major investment bank when the head of that desk said he would much rather be hiring “street kids from India” than, presumably, the rather pastier looking option in front of him. It seemed a noble enough aspiration and so I chose not to respond that he was unlikely to find many hanging around a bank in London.
Of course, Standard Chartered’s three year programme will have to indoctrinate its recruits into investment banking as it is practiced and it will no doubt have selected those candidates that it thinks will do the best in that world. The apprentices will have to adapt to the business, not the other way around.
But it will nonetheless be directly injecting into its front office recruits with vastly different experiences and outlooks than it likely has had before. That will not change the culture of the capital markets overnight, but it is an important start.
For all the academic achievements banks demand, two more useful assets are hard work and commitment. They can only be observed in the field. The rest can be taught — and Standard Chartered says it will.
The bank has gone to extra lengths to see that applicants are able to take up the work on offer, covering travel and clothing costs before an apprentice’s first salary payment clears.
It has also acknowledged the imposter syndrome that may strike so many who have not been able to pay for the sort of education that force feeds its pupils confidence, or who, like most people outside of banking, have little idea what an investment bank does. The bank says it is running an “onboarding programme which looks to develop professionalism and confidence in the workplace.”
This shows that Standard Chartered is taking on the tough end of the diversity challenge. More often, companies set diversity targets around increasing the proportion of under-represented groups in senior positions — often at board level.
That may be a good thing, but the staff recruited at that level are hardly unknown quantities, making it less of a bold move. They will be polished candidates with established careers and networks. Moreover, it usually only means hiring one or two people from the under-represented groups and offers no guarantee that those people won't be from privileged backgrounds themselves.
Instead, Stan Chart is hiring in greater numbers — six apprentices this time — and it is taking in raw recruits. That has a much higher chance of failure perhaps, but will prove transformative for the recruits themselves. It also sends a message to others from similar backgrounds about what is possible, a message that will be far more relevant than that conveyed by one or two mid- to late career executives appointed to a board of directors.
Now that the big secret is out — that you do not need to be able to calculate the trajectory of a rocket ship to Mars to work out the price of a bond — more firms must follow Stan Chart’s example and open up genuine front office opportunities to a wider pool of people.
The benefits are clear: rapid social mobility and useful skills for the apprentices; a greater diversity of opinion and background for the bank, not to mention three years more productive experience on the job rather than spent in a university library (or student union). Now that is an education you cannot buy.