The news this week of what can only be described as the sudden departure of Ian Carrington, chief executive officer of the Financial Services Commission (FSC), must have caught most Barbadians by surprise. Indeed, it was shocking to hear that he was not renewing his contract but returning to his substantive post as director of the National Insurance Scheme.
This departure raised alarm bells, since Carrington’s appointment to lead this watchdog of all non-banking financial institutions, insurance companies and the stock market, was seen as a promotion for him, and spoke to confidence in his ability to give leadership to this entity.
We have been fortunate to have had a good supervisor of the banking sector over the years in the Central Bank of Barbados but learnt the hard way why we need better regulation of the other financial services. The collapse of Trade Confirmers Limited some years ago still haunts many people. The recent events with CLICO and British American Insurance Company have not helped this situation. Â
So the FSC was seen as a necessary step to help boost consumer confidence in the products and services being offered by those in the non-banking and insurance sectors. After all, the investing public wants to know that there is an independent eye constantly scrutinizing the operations of the various companies with whom they seek to do business. Equally important for the businesses, they want to have the FSC’s stamp of approval.
While the FSC is not a one-man show and must be bigger than any individual, it is important that it enjoys the kind of stability and reputation similar to the Central Bank. So, losing its CEO in unexplained circumstances a year after it started leaves many puzzled.
The FSC must have strong leadership both at the level of its board and the executive management with independent thinking from either side. Adherence to best practices as it relates to corporate governance and having a visionary outlook are qualities the FSC must display.
We believe there must be the ability to scrutinize and challenge both from the board and the executive management. Where problems have been identified, they must be addressed quickly and firmly.
We cannot have a situation where an institution as important as the FSC is allowed to fall into the trap that has plagued other statutory corporations: high staff turnover and constant conflict between the political directorate, boards and executive management. The FSC must epitomize confidence in the financial sector.
Given what is required to navigate the local and international uncertainty that bedevils the financial sector, we must have the best fit in terms of leadership of the regulatory environment. In the circumstances, the public needs to know whether Mr Carrington walked or was pushed.
