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Man at the top

The man who has been given the responsibility of turning the theory of a single financial regulator into a reality has had a busy time at the top.

Between preparing the industry for N2 and dealing with episodes like Equitable Life or the aftermath of the September 11 terrorist attacks, FSA chairman and chief executive Sir Howard Davies has had little time to relax since his appointment on August 1, 1997.

Davies boasts an impressive curriculum vitae. Before heading the FSA, he spent two years serving under Eddie George as deputy governor of the Bank of England.

Prior to that, he was CBI director general for three years, controller of the Audit Commission for five years and worked for management consultancy McKinsey & Company from 1982 to 1987. For two years during that time he was seconded to the Treasury as special adviser to then Chancellor Nigel Lawson.

His responsibilities are like those of any chief executive of a major firm, internal and external meetings, making speeches, attending conferences and even fitting in time for interviews with the media.

Davies chairs the FSA monthly board meeting, which is attended by the FSA&#39s three managing directors as well as the dozen or so non-executive directors at the FSA.

He also presides over the annual board meeting, where he must present the regulator&#39s annual report.

Unlike other important figures, Davies does not appear to have a right-hand man as such. Rather he has two right-hand men and a woman – the three managing directors, Michael Foot, John Tiner and Carol Sergeant.

As the front man for the FSA, Davies also appears regularly before the Parliamentary Treasury select committee to account for the activities of the regulator.

Most recently, he was there to testify about Equitable Life and the regulator&#39s handling of the debacle following the publication three weeks ago of the Baird report.

One gets the impression he is actually enjoying himself when matching wits with MPs questioning him about the relationship between his salary bonus being cut and the FSA&#39s handling of the Equitable affair or when he is challenged by members of the media about one matter or another.

One of the most ferocious debates held in both Houses of Parliament when the Financial Services and Markets Bill was making its way through the legislative process was over the positions of chief executive and chairman of the FSA and how, in contrast to the accepted laws of corporate governance, one man is allowed to occupy both at the regulator.

Interestingly, nobody involved in the debate had any problem with Davies holding both positions. The arguments were that the necessary provisions must be made for the post-Davies era. This is an indication of the high regard he is held in by most people in political and business circles.

There has been much speculation that Davies is restless and looking to find a new challenge. When he was appointed by the Chancellor in 1997, it was for a five-year term which expires on July 1, 2002.

The official line from the FSA is Davies is not concerned about what he will do next as it is the Chancellor who decides whether he wants to offer an extension to the term.

Once the N2 hurdle is successfully completed, it would seem quite possible the man who has for many been the face of the new regulator will move on.

He is already, on behalf of the Chancellor and Trade and Industry Secretary Patricia Hewitt, conducting a review of the awareness of business, enterprise and the economy across schools and further education. This is expected to report back to the Government by January 2002.

Wherever Davies goes after he leaves the corridors of Canary Wharf – and he will go on somewhere – at only 50 he has much left to contribute to the business world.

The job he has done as the FSA&#39s first chief executive and chairman will not soon be forgotten.


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