Living in a fool’s paradise: the collapse of Barings’ Bank
2002; Emerald Publishing Limited; Volume: 40; Issue: 3 Linguagem: Inglês
10.1108/00251740210420183
ISSN1758-6070
Autores Tópico(s)Organizational Management and Leadership
ResumoRecalls that the collapse of Baring’s bank showed what may lie behind an apparently successful organization. Barings was destroyed by the unauthorised activities of a trader named Nick Leeson. For almost three years Leeson deceived the bank by appearing to earn phenomenal profits, while in reality incurring massive and ultimately catastrophic losses. A striking feature of the bank’s collapse is that it was both sudden and total. No one had the least suspicion of impending catastrophe despite the emergence of clear signs of malfeasance. The article explains why Barings’ management failed to respond effectively to those danger signs and considers the lessons to be learned.
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