ABSTRACT
This chapter explores the intellectual lessons from the failure of HBOS, discussing how the theories and teaching curricula need to be revised to shape a more caring financial future. Business complexity and risk are evident throughout the investigations into HBOS. There were a range of products and services, international branches and subsidiaries and large numbers of managers at different levels of the organisation. There was an overwhelming reliance on secondary data and evidence, rather than a Board engagement directly with customers and their businesses. There was a significant reliance on processes and rhetoric like the 'three lines of defence' in the area of risk management which turned out to be neither lines nor defences. Ethics and culture need to be at the centre of finance education, and not virtually ignored or marginalised as they are today. Systemic risk is very real in banking, and large banks are systemically important institutions.
