Global Values in Business 389People were aware of these threats, but somehow the right questions
had not been asked, or not asked in the right context. It is essential not
just to ask the right questions but to make plain your reasons for asking
the question. We lived in Melbourne in the early seventies. Before we
arrived a major bridge over the Yarra River had tragically collapsed due
to a design error in its box girder construction. The redesigned West
Gate Bridge was being built, an elegant bridge high above the river. I
asked a neighbour who was involved in the construction why it was so
high. He told me the possibly apocryphal story that when the bridge was
being designed, the engineers contacted the Royal Australian Navy who
had a dockyard just upstream of the bridge and asked them what the
largest ship that might need to enter. The answer was the aircraft carrier
Melbourne. The questioner then asked how tall the mast on the Mel-
bourne was and added a small safety factor to the answer. When the
bridge was being built, the navy enquired why it was so high. They were
told that it was because of the height of the mast of the Melbourne; to
which the navy replied that the mast on the Melbourne could be folded
down. This story may well be apocryphal, but it is a very useful anec-
dote to illustrate why one should not only seek information but also give
people a good briefing on the background to the questions.
In the banking crisis the fact that banks were overleveraged with
large amounts of wholesale borrowings was not unknown. Yet I know
that many shareholders of HSBC urged the bank to gear up its balance
sheet, which they criticised as being hopelessly conservative. This was
resisted. But although the executives of the bank and the board knew
that some competitors were overleveraged, none of us foresaw whole-
sale melt down. I think we imagined that perhaps one or other bank
might have a difficult time. The regulators such as the FSA, who were
initially quite frank in confessing that they had been concentrating large-
ly on protection of consumers from miss-selling and their own folly,
have subsequently escaped quite lightly as popular fury focussed collec-