Should ‘Fred the Shred’ be allowed to keep his pension?

Those of you living on planet earth will undoubtedly by now have heard about the all time record losses at UK banking group Royal Bank of Scotland – at £24.1bn ($34.2bn), even that amount of money cannot be blamed solely on events outside of the Bank’s control.

Spare a thought then for Sir Fred Goodwin, or ‘Fred the Shred’ as he is unaffectionately called in RBS, who until October 2008 was the Bank’s CEO; and his £16 million (£693,000 per year) and ten year early pension pot (see:  http://news.bbc.co.uk/1/hi/uk_politics/7912651.stm). 

Apparently the British Government, through Lord Myners, was aware of this obsene package, but was led to believe that RBS was contractually obliged to pay this money to Fred Goodwin.  An astonishing reward for failure.  Perhaps they should have put in place more effective mechanisms to track and manage their HR contracts?

Contract Management solutions like Dolphin Contract Manager would have been able to keep a record of key contract milestones and obligations and any authorised person would have been able to undertake thorough due diligence by interrogating RBS’s contract repository and creating the necessary management reports.