As the full effects of the credit crunch emerge, it’s not surprising that the financial services sector is reacting in the traditional way – belt-tightening, redundancies, stricter regulation and reduced investment in people. But recent Hay Group research suggests that enhancing leadership could also play a big part in improving performance.
Organisations that keep their cool and identify, retain and build the right kind of leaders will outperform their peers.

The research shows that the best leaders – those who take a longer-term view and engage their team – create energising climates that can improve bottom-line performance by up to 30 per cent. But in-depth talent reviews of 583 leaders in eight financial services firms suggest that only 37 per cent of leaders engage people in this way.
The remaining 63 per cent take a short-term approach and focus on the numbers at the expense of the bigger picture, creating disengaging climates that adversely affect financial performance. We have calculated from current balance sheets that the industry could reap a further £8.5 billion in profits through engaging leadership.