Practice, tradition and social structures

In After Virtue, MacIntyre gives a broad description of how he sees the relationship between practices and traditions. ‘To enter into a practice is to enter into a relationship not only with its contemporary practitioners, but also with those who have preceded us in the practice’ (MacIntyre, 2007, p.194). A practice is the achievement of a tradition.

These traditions ‘through which particular practices are transmitted and reshaped never exist in isolation [from] larger social traditions’ (MacIntyre, 2007, p.221).

Institutions are seen by MacIntyre as bearers of traditions as well as practices, and when they are working well those institutions are engaged in the kind of ‘arguments about […] goods’ which also characterise traditions (MacIntyre, 2007, p.222).

In these passages MacIntyre articulates fully the nature of the relationship between institutions and practices. He is very clear, for instance, that although they form a single causal order, practices are not to be confused with institutions; there is no sense in which an institution can be an element of a practice. He does not so fully describe the relationship between institutions and traditions. In the following paragraphs I

attempt to elaborate this latter relationship, suggesting that an institution can in fact be an integral part of a tradition.³⁸

For the purposes of the current discussion, I have taken the liberty of proposing a relationship between institution and tradition in a way which extends beyond what MacIntyre has set out in After Virtue. I have configured institutions as possible

elements of traditions, because I have characterised tradition as something handed on.

This does not of course exclude the idea that an institution should be the bearer of a tradition; very often institutions are created by traditions just for that purpose.

However, it does mean that the relationship between institution and tradition is rather different from that between institution and practice. It means that institutions are often an integral element of the traditions which they bear. So, for instance, in the case of Christian churches, Moore (2011) can investigate the practices of faith and the institutions of the churches as related but discrete: practices are activities and

institutions are structures. The same separation would not hold between tradition and institution; the institutions of any particular church are not only a means of handing on, they are also characterising elements of what is handed on. Insomuch as traditions are socially embodied, they comprise not only activities (including practices), but also narratives, artefacts and social structures.

Two kinds of institution

In the current research we have access to thick descriptions of the tradition of banking in Scotland, complete with narratives and social structures. Some of those structures are elements of that wider Scottish social tradition in which the lesser tradition of banking was located, and some are elements specifically of the tradition of banking.

Core structures in Scottish banking included formal institutions of two main types, the banks themselves and the Chartered Banker Institute. The two have different functions and different histories.

The banks were set up specifically to conduct banking, and the practice of banking could not be conducted in their absence. The narratives of the decline of old banking are also narratives of the transformation and loss of those institutions. Scottish banks were not imported. They grew up in the eighteenth and early nineteenth centuries as a

38This separation holds even where the practice concerned is ‘the making and sustaining of forms of human community — and therefore of institutions’ (MacIntyre, 2007, p.194). This distinction seems relatively straightforward if we consider practice as a kind of activity and institution as a kind of structure. My argument for the inclusion of institutions as potential elements of traditions depends partly on the idea that traditions, unlike practices, are not only activities, they also imply structures, including structures of authority as well as a range of wider

specifically Scottish phenomenon, objects of national pride for the Scots and

admiration for other nations including the English (Munn, 1981). They were set up by the tradition, and the handing on of the banks from one generation of Scottish bankers to the next was a core part of what the tradition involved. Those banks came to be run in the late twentieth century by people who were not traditional bankers and often not Scottish. This not only threatened the integrity of the practice of banking; it also threatened that the banks would be lost to the tradition which had created them in the first place. And this does seem to be what happened. The mainstream banks became multinational diversified financial conglomerates, rather than banks in the traditional sense. In the course of this transformation, these large institutions transferred their allegiance to different overarching social structures, which were not Scottish but UK wide and global. Originally embedded in the social structures of Scottish cities and towns, communities and Kirk, the major Scottish banks are now embedded in the structures of international stock markets, institutional investors and industry regulators.

The Chartered Institute was founded in 1875 not to conduct the practice of banking, but to hand on the tradition through education and qualifications and socialisation: ‘to encourage the highest standards of professionalism and conduct amongst [its]

members in the public interest’ (Chartered Banker Institute, 2014). A key part of what the Institute did was to define the core membership of the profession, and this was also to define the membership of the tradition. It was originally a specifically Scottish

institution, but took on a UK wide remit with the arrival of deregulation and the

abandonment of the separation of Scottish from English banking systems in the 1980s (C1: 2, C4: 86).

A number of views of the Institute are offered by several participants in these

conversations, some of them critical. Since several of the participants are also closely connected with the Institute at a senior level, it is not possible to offer both sides of these views supported by detailed evidence from the primary data without breach of confidentiality. However, a brief summary of the arguments is still possible.

The Chartered Institute as a pivot point for the tradition

Without mechanisms by which one generation can hand over to the next, a tradition cannot continue. This may account for some of the anxiety which is evident

concerning qualifications and the Institute. Talk of ‘lost generations’ (C5: 95) and depleted cohorts (C8: 146), the proliferation of people who are not qualified bankers in management positions (C5: 97, C3: 72), and the feeling that there are few real bankers left (C6: 128, C8: 145) all convey a sense of anxiety about the continuation of the tradition of banking, and this sits behind the more obvious anxiety concerning the

image of the industry. The problem is not just that it is unclear how banking can recover, it is much worse than that: there is soon going to be no one around who will be capable of leading such a recovery because no one will understand how to conduct proper banking: the tradition will have died.

The great advantage of the Chartered Institute in the context of old banking was that it drew together leaders in Scottish banking for the purpose of maintaining professional standards; it acted as a pivot for the tradition. There was a general, unwritten

agreement that attainment of the full Member’s examination was a requirement in order to pass to senior levels of the profession. There was also an understanding that all the Scottish banks contributed to the upkeep and the governance of the Institute (C1: 1) and that they encouraged all potential future managers to take the Institute exams (C2:

45). Inclusion in this professional body through formal examination was what separated bankers from non-bankers, together with the informal processes of

apprenticeship and experience. These delineations had a central place in identifying the profession.

This unanimity began to break up at the same time as the banks began restructuring in the 1990s. The assumption that all potential managers would be encouraged to gain the banking exams was abandoned, and the Institute lost the automatic support of senior bank leaders (C1: 4). This process went hand in hand with the abandonment of the assumption that senior bank leaders had to be bankers ‘born and bred’. Numbers taking up the qualifications and attaining full membership fell away. There were internal tensions within the Institute over these changes, because the Institute was dependent on the banks for funding, which meant that structurally it was not in a strong position to take an independent line from the banks (C3: 72-73). Despite this structural tension, the Institute remains that body which more than any other seeks to uphold the traditional standards of banking, and it has been proactive in establishing a

Professional Standards Board (Chartered Banker Institute, 2011a).

When we consider the possible futures for banking in Scotland below (S6.11), the Chartered Institute clearly has a central role to play. At this point it is worth noting some key differences between the way that the banks have changed compared to the Institute. What occurred with the banks was that the largest became larger or merged with other institutions to become fully ‘new bank’, operating on an international stage.

A new breed of leaders, not of the tradition, took over key posts, and institutional structures changed so that as they are now these institutions are very clearly no longer part of the tradition of old banking in Scotland. The banks became to a large extent

tradition, at least a clear sign of its dramatic decline; a tradition of banking without banks to hand on would be a rather theoretical version of its previously practice-based form.

Grounding of the tradition in social goods

If this idea is plausible, that a key part of what was handed on in the tradition of old banking in Scotland was its institutions, then it becomes somewhat clearer how the relationship between tradition and practice appears to work. The tradition handed on a particular practice of banking, together with the banks which supported the practice and the Institute which bore the tradition and upheld the standards of the practice. The Chartered Banker Institute became the central mechanism by which the standards of the practice and the formal learning on which they depended were handed on, whilst the banks provided the actual locus for the practice itself.

The tradition also provided other things for the practice through these processes. It provided a set of social goods (Gore, 1997³⁹) which the practice pursued, and which were expressed in terms of relationships and virtues. These social goods did not spring fully formed out of the tradition itself, but were transmitted by the tradition of old banking from larger traditions of kirk and community. So the goods of cooperative business relationships, respect in the community, the preservation of wealth, honesty in business dealings, accuracy and justice and so on, were all dependent on the larger social structures from which the tradition of banking developed.

This leads to the observation that the practice itself could potentially vary quite markedly over time without loss of coherence so long as the tradition was intact and still linked to the wider tradition of which it was a part. For instance, new technologies such as computers capable of taking over and then making obsolete the manual clerking duties on which old banking depended necessarily changed the practice, but they were not enough in themselves to account for the radical shift from old to new banking. For that shift to occur, there had to be a more fundamental move away from the goods of the tradition on which the practice originally depended. This could have occurred in more than one way. One possibility is that the background social

39 Gore (1997) follows Charles Taylor’s coining of the phrase ‘irreducibly social goods’ to mean those goods which cannot be reduced to individual ones. The distinction is helpful, but I intend here a weaker version of the idea of social goods, meaning those goods which imply and are founded on social structures, and which cannot be understood in their absence; but they can still be attributed to an individual, so long as that person remains located in his or her social setting. For instance, the good of respect in the community is social in this sense, and cannot be understood in the absence of the social setting in which it is bestowed, but it also rightly pertains to an individual in that setting.

structures of the political community in Scotland changed quite radically, with the result that the wider basis for the goods of the tradition of old banking no longer pertained, and the tradition itself gradually weakened. A second possibility is that the practice of banking was forcibly wrested from the control of the tradition; it didn’t so much suffer an epistemological crisis as a crisis of property.

From the evidence of these conversations it appears likely that both of these things happened. Changes in the background of Scottish society weakened the basis on which the tradition depended, so that when an influx of new forms of the practice of banking entered the field in the 1980s and 1990s, old banking quite suddenly gave way, and the larger banks passed over to an entirely different tradition or culture. As well as using the terms sales culture and bonus culture some of the participants identify this new culture as a new form of capitalism, international and aggressively competitive (C1: 13, C5: 101, C8: 156).⁴⁰

This picture may be arguable in its detail, but the overall point seems to be clear, that in old banking there was an intimate dependency between practice and tradition. Their goods were one and the same, and they depended in turn on the wider social tradition from which old banking developed. When this is understood, then a number of

questions regarding virtues, goods and the corruption of the practice become easier to approach.