Im not one of the bad ones, so why should I deny that Im a banker?

Susan Rice is an enthusiastic patron of the arts. Pic: Julie Howden FACE TO FACE: Susan Rice interviewed by Anne Simpson 15 Aug 2010

In those hours when the Fall of Mammon almost reduced global capitalism to ruins, Susan Rice thought twice about revealing her professional identity to strangers. It was a horrible, horrible moment in history for everyone, she says. In social gatherings you dreaded somebody inquiring about your line of business. Then one day, travelling in a London cab to a crucial meeting in the City, the driver asked her that very question. I did actually hesitate. Then I thought: No, Im not one of the bad ones so why should I deny that Im a banker? Banking is what I do. Emboldened, but with her customary quiet, good manners intact, Mrs Rice didnt fudge her reply, hoping that the driver wouldnt order her out of the cab. In fact he responded in a very humorous way and we chatted for the rest of the journey. But on that flight back to Edinburgh, I realised just how much peoples trust in us had been damaged. Sensitive candour is among the reasons why many in the business community believe we need more bankers like Mrs Rice whose easy, American affability combined with a highly developed social conscience has made her one of the most unusual movers and shakers in Scotland. Last November she stepped down as chairman and chief executive of Lloyds TSB Scotland to concentrate on an expanded role as managing director of the Lloyds Banking Group in

Scotland. What also distinguishes her career is a belief that the arts are fundamental to a healthy society. As a consequence her strong advocacy of them as a vehicle for social inclusion offers a corporate world the chance to act as a benign Medici. Among many appointments, she chairs the Edinburgh International Book Festival and the Edinburgh Festival Forum to ensure the citys pre-eminence on an increasingly competitive global circuit for such events. Born and raised in Rhode Island, and the holder of seven honorary doctorates from Scottish universities, Lady Susan Rice is the wife of Sir Duncan Rice who recently retired as principal of Aberdeen University. The couple met in America when she was an undergraduate and he was on a fellowship at Harvard. Were very fortunate in that we have similar tastes in the arts but I was also lucky to be a student at Wellesley College which had very strong art history courses, and through those I learned to use my eyes in a way I didnt know was possible before. Mrs Rice attended Wellesley when Hillary Clinton was also there. I think we were a year apart and although our paths will have crossed I didnt know her in any close way. In discovering the arts as a form of human expression, Mrs Rice realised how they could help us come to terms with change, find solutions and reach across national and linguistic differences. But today the draconian axe of spending cuts is about to fall on arts organisations, slashing grants by an estimated 25-40%. In so punitive a climate can the arts any longer rely on bankers as sponsors? Well, whether theyre seeking backing from the public, private or philanthropic sectors, they must be able to argue their corner and that means understanding their own businesses inside out. These days, she warns, nobody should assume they will get a grant just because they had a grant before. Any arts body should have a board guiding it to think about contingencies. The severity of cuts might mean the demise of some organisations and that would be very sad. There again, others might be in a better position to trim their programmes and still keep going, even expand creatively. Mrs Rices job as a banking MD involves building an overview from market data, and providing economic updates on how the wealth business generally is performing in Scotland. In the arts world she sees herself as a facilitator making linkages between her organisation and sponsorship opportunities. When we decide to engage with an arts association we discuss how they want to develop their agenda with unique programmes. Its very collaborative, testing ideas to the limit by asking many dozens of questions before we make a decision and

eventually write a cheque. For me, as in business, the excitement lies in achieving a new market, breaking new ground. But 18 months on from money meltdown, Mrs Rice remains acutely aware that public anger over the venal players who caused the mess, hasnt lessened and that it will continue as long as stories emerge about corporate spivvery and reckless banksters pigging out on bonuses. She maintains, however, that 98% of those involved in banking are good people who are not there for personal gain or benefits. Nor am I. Ive never worked in investment banking and been in a position to get a gigantic bonus. But when youre in pain its human nature to want to hit out. Even so, I didnt feel good about the way certain people were pilloried because that just feeds negativity. When theres a problem the most important thing is actually the hardest to achieve. Its getting everyone in the industry to realise there is a right way to do business, and that involves changing the mindset which concentrated only on the short-term perspective and never stopped to consider the repercussions and implications. We may demonise bankers, she says, but they do matter greatly. Of course, how they do it matters even more, but we cant have a modern society without them. Mrs Rice started out in academia becoming a dean at Yale and Colgate Universities, then moving into finance in 1986, eventually to become a senior vice-president at NatWest Bancorp on Wall Street, New York. After marrying and settling in Aberdeen, where she and her husband have their main home, she was appointed managing director of personal banking at the Bank of Scotland, and at Lloyds TSB Scotland she became the first female chief executive of a British clearing bank. Among her many duties she is senior independent director of Scottish and Southern Energy, and sits on the court of the Bank of England where she chairs the audit committee. When we met she was dining later that evening with Mervyn King. More women in the boardrooms of banks too big to fail might have prevented those self-styled masters of the universe, wrapping up so much risk in delusional jargon? Boardroom culture, Mrs Rice muses, depends on the leadership approach of the chairman. You can have a board of all men, or indeed all women, which is encouraged to ask questions and challenge, and that will work more effectively than a board where members are always showing off to one another. There is some evidence, though, that the few UK companies which do have women on their boards, are more profitable over the longer term.

In Mrs Rices view those women musnt be shy of asking the daft laddie questions. When I first began in banking I didnt have a clue what people were talking about and it was a very humbling experience. I had to take a deep breath and say to my new colleagues: Look, Im sorry but Im ignorant and dont understand this. Please explain it to me. Far from being met with Wall Street scorn, that strategy worked brilliantly. Ever since its been my experience that people love to tell you things, and sharing knowledge opens doors. Mrs Rices love affair with Scotland began the Christmas she became engaged and flew from America to meet Duncan Rices family in Aberdeen. My first impression was of the absolute greenness of the place even in winter, and the wonderful cloud formations as we travelled north from Prestwick. To the observer, though, her life seems too bolted on to fast-moving markets for time spent marvelling nature. But thats where South Harris comes in. The couple have a house there, out of range of tyrannous fax machines and mobile phones. It looks out on one of the most wonderful views ever, with little islands dotted like stepping stones. It is there, she says, where one feels somehow closer to the heavens, and the cares of the workplace settle gently. Life and Loves High point: My husband and three children always. Low point: The Scottish cricket teams ODI against Australia when rain clouds rolled in, the covers came on and off but not a stroke was played, and I never got the match T-shirt for my son. Favourite movie: Four Weddings and a Funeral. The only time Ive been on a plane where passengers laughed out loud and the pilot put on an extra showing. After landing in New York, he stayed on the edge of the runway to let the last five minutes of the film play out. Favourite music: Die Frau ohne Schattan by Richard Strauss; breath-stoppingly beautiful. Last book read: Your Face Tomorrow by Javier Marias. Best personal trait: Tenacity. My husband says I work hard. Worst personal trait: My husband says I work too hard; also impatience with those who talk or think too slowly.

Best advice: Years ago when I started to play squash it wasnt until someone told me: Keep your eye on the ball, not the racquet that I was able to connect. Worst advice: If it that leads to unnecessary complexity. Einstein said: Keep things simple but not more simple than they are. Favourite holiday destination: South Harris surrounded by the most magnificent landscape and the oldest rock in the world. Favourite meal: Smoked (wild) salmon, rack of lamb, cheese, vignotte, followed by an American brownie and coffee ice cream. Ideal dinner guests: Margaret Atwood, Rahul Dravid, Mervyn King, Sandy McCall Smith and the Duke of Edinburgh.