It was a lingering reminder of Royal Bank of Scotland’s former boss Fred Goodwin: the blue and yellow carpets that were allegedly handpicked by the disgraced banker, who was blamed for the bank’s near-collapse more than a decade ago and was subsequently stripped of his knighthood.
But NatWest – which scrapped the toxic RBS Group name last year in the hope of moving on from past scandals – has done away with the old, by ripping out carpets, ditching office phones and installing Zoom-enabled meeting rooms, as it ushers in a new era of hybrid working turbocharged by the Covid crisis.
In London, desks that once dominated its 10 floors at 250 Bishopsgate in the City, are now flanked by pastel couches, quirky lamps, and hundreds of electrified lockers full of charging Chromebook laptops for visiting staff. Cafe-style meeting rooms are separated with stylish soundproof curtains, and anyone looking for a break from noisy colleagues can retreat to single-person pods for privacy.
NatWest’s office transformation is part of its efforts to cater to the new hybrid worker who will split their time between home and office from next week. The trend has forced firms across the City to think about their office as more than a place for a computer and chair, and to get creative about what will lure staff away from their home comforts, even as the pandemic rages on.
The bank has spent millions of pounds on the office overhaul under its current chief executive, Alison Rose, but the cost admittedly pales in comparison to Goodwin’s excesses, which were criticised for crippling RBS and leading to its £45bn government bailout during the banking crisis in 2008. And this time it is about adapting to a crisis, rather than inadvertently triggering one.
Most of NatWest’s 64,000 employees will return to their offices on Monday for the first time since March 2020. But only 13% will be required to be at their desks five days a week, while one in three will be able to live and work anywhere in the UK and go into the office just two days per month.
“This is the chance to define a new way of working,” Rose said, explaining that the pandemic had “busted a few myths,” about the need to be in the office five days a week in order to be productive.
And Rose is not alone: 2021 has been punctuated by announcements from City firms offering flexible working, including HSBC which is planning to slash global office space by 40% as its capitalises on new hybrid working arrangements. Meanwhile, Deloitte has said its 20,000 UK staff could decide “when, where and how they work”, while PwC said it only expects staff to spend at least 40% of their time with colleagues – either in the office or out on client visits.
Rose said it was all part of staying relevant, as well as retaining staff, who may yearn for better digs and could be poached by any of the bank’s rivals. “We’re in competition, [but] not with just banks. We’re in competition with private equity and fintechs and Google,” she said.
“If you want to keep that talent, you want to give them the flexibility to work in a different way. And really talented people have lots of choices of where they can work and how they can work.”
But other major banks, particularly on Wall Street, are less concerned by a potential preference among workers to work from home. In the US, Morgan Stanley’s chief executive, James Gorman, told his New York employees that anyone who feels safe going out to a restaurant should return to the office this month, while Goldman Sachs boss, David Solomon, called remote working an “aberration” that did not fit with the bank’s “innovative, collaborative apprenticeship culture”.
Unlike NatWest, all of Goldman’s 6,000 London bankers are expected to return to their Plumtree Court office from Monday as it ramps up office capacity and ditches social distancing between desks. Its short-lived perks such as free food and gelato – widely seen as a lure for hesitant Goldman bankers throughout the summer – are being scrapped as the bank tries to return to the old normal.
NatWest’s more relaxed approach may be down to the lender’s own journey since the financial crisis. It has severely scaled back its riskier investment bank, which accounted for roughly 40% of its operating profits in 2006 prior to the financial crash, but has been loss-making for years. RBS has gone from being one of the world’s largest banks, with operations in 43 countries, to a less risky British high street bank still 55% owned by the UK state and operating in 25 countries. It is hardly in competition with its former Wall Street rivals.
Rose has accelerated that shift away from RBS’ riskier past, even changing the bank’s name last year in one of her most sweeping changes to date. While she has been more cautious than most of the bank’s previous chief executives, Rose is clearly leaving her mark ahead of the bank’s likely return to full private ownership, with the government hoping to sell its remaining stake by 2025/26.
Even Coutts, which sits under the NatWest umbrella and is known for its opulent offices at 440 Strand in London’s West End, is moving towards a hybrid arrangement for its wealthiest clients, with plans to hold three of their four quarterly check-ins online after the pandemic is over.
But Rose insists office culture will persist, and played down wider fears about how remote working would decimate city centres and the ecosystem of shops, cafes and restaurants that rely on them.
“We’re going to have all our buildings pretty much occupied,” she said, “but it might not be by the same people all the time. So if someone’s coming in for three days a week, it doesn’t mean that for two days a week the office will be empty”.
“Equally I think the ways of working have changed and so it’s really important that we continue to evolve.”