And they account for 42 per cent of the workforce and 40 per cent of the Emirate’s GDPNovember 24, 2015 4:32
Interview: Ibrahim Dabdoub, NBK
The Group CEO of the National Bank of Kuwait, Ibrahim Dabdoub, tells Trends about how the global economic meltdown was good for the Gulf.
January 27, 2010 10:50 by Julien Hawari
How do you gauge the impact that it is having on business? How are companies adapting?
Well, companies are spending less and, as a matter of fact, are investing less. There’s a question mark over the future. There aren’t many good borrowers anymore. It’s a blow both to the business cycle and the investor mindset. I think once we see the government spending, business will feel more at ease. And I believe there will be more spending in the coming months.
First the global financial crisis and then the region was hit with the Saad problem. Bankers typically rely on reputation. Is this over? Is the new bank different from the old bank?
No, I don’t think it’s over, and in any case banking won’t change overnight.
Name lending, especially in the Gulf, is part of our culture. So is reliance on reputation. What change there will be concerns corporate governance. That was the problem in this Saad case. And so too with Dubai.
At the World Economic Forum we dedicated a session to corporate governance because we seem to have lost sight of it.
There should be a separation of responsibilities, of duties, as far as ownership and management is concerned. There should be some independence, but there should be more involvement of the boards on the issue of compensation, especially bonuses.
The conduct of US and European banks has been both financially and socially unacceptable. You cannot have a banker take a bonus that is 100 times the salary of a first class brain surgeon. It’s socially wrong.
How would you have this corporate governance trickle down in the Gulf? The region shuns transparency.
I think it’s going to take some time, definitely. We can start with the big institutions like the banks. We have to educate the board; we have to educate the regulator as to how they can advise and rule on corporate governance. And then it will catch up by example. Championing it is a good first step.
We’ll be talking and writing about it, and getting experts to talk about it. In our case, Sir David Walker, who has written a paper for the British government, is a member of our board of advisors. And he is advising us and other institutions here on good corporate governance.