The world lost a true leader in the effort to raise international standards for financial institutions when George J. Vojta died in December.
He not only had a distinguished career at Citigroup Inc., where I first met him as a colleague, but also was a vice chairman at Bankers Trust.
He also took a prominent role in consulting with the World Bank, Bank for International Settlements and national governments in response to financial dislocations from the 1970s through the 1990s.
When I became superintendent of banks for New York State in 2007, George had already been on the New York Banking Board for many years; once again, I found his advice invaluable.
In the current times of economic instability, the perspective of an intellectual of George's caliber and experience is sorely needed. The financial crisis has prompted a global rethinking of the basics of banking, from regulatory reforms of prudential standards to more aggressive consumer protections. But at an even more fundamental level, it has provoked a kind of identity crisis regarding the nature of capitalism itself. Where do we go from here to reconstruct not just our regulatory framework but also confidence in the economic paradigms underpinning that framework?
To everyone who is absorbed with these issues, I would commend George's writings, especially his latest book, "Globalization for All." George had a compelling vision of a financial and economic system that was market-based and socially responsible.
He called this "moral capitalism," which offered the benefits of globalization across all levels of society.
These high ideals were supported by a concrete action plan. George was a strong advocate of international standards and best practices, and he wanted compliance benchmarks incorporated as variables in risk decisions. This went beyond an institution's own internal risk management. He saw a world in which compliance with international expectations would also be a significant component of external assessments such as an institution's regulatory evaluation and its credit rating.
I think George's insight hits the nail on the head. For best practices to be truly transformative, there must be consequences that can affect the bottom line. Measuring how well an institution conforms with international best practices gives consumers and investors a clearer picture of a company's true risk profile and its degree of engagement as a corporate citizen. International standards-setting bodies and their U.S. counterparts like the Financial Stability Oversight Council should consider ways to strengthen ethical values through enhanced corporate governance and risk-based evaluations. George's broad legacy includes a road map for making that a reality.
