They searched far. They searched wide. They considered more than 50 candidates. But in the end, Standard Chartered’s directors chose as chairman a man with no direct commercial banking experience.

The demand for untainted banking talent is intense – just look at the running competition for the services of Citigroup’s Sir Win Bischoff as a chairman. John Peace – who spent most of his career at GUS, the retail and credit services group, then at spin-offs Burberry and Experian – will have able support from experienced Standard Chartered directors. He has served on the board’s audit and risk committee. But he still has a lot to prove.

Last time Standard Chartered appointed a chairman in 2006, the headhunt ended at the chief executive’s office and Mervyn (now Lord) Davies was elevated to the chair. The governance police sounded the alarm. But that decision and HSBC’s promotion of Stephen Green from chief executive to executive chairman on similar grounds have been vindicated . The two companies were the only big UK-based banking groups to come through the credit crunch largely intact.

Mr Peace is a high-calibre chairman and director. But it is telling that he was also tipped to head a very different and much simpler company: retailer J Sainsbury – whose former chairman Sir Philip Hampton now has the same role at Royal Bank of Scotland.

In 2006, Standard Chartered made the case for the internal appointment of Lord Davies on the basis that “there were significant benefits …in continuity”, saying it had taken into account “the complexity of the international banking environment . . . the magnitude of the group and the diversity of its businesses and people”. Since then, has the international banking environment become simpler, the group narrower, or its businesses and people less diverse? Patently not. Would the board have chosen a commercial banker such as Lord Davies over Mr Peace if such a candidate had been available? Obviously. Banks such as Standard Chartered, HSBC and RBS are vast and complicated businesses. Their importance to the global financial system has just been brutally demonstrated. Standard Chartered got Peace. Let’s hope he brings understanding.

F&C: free & clear?

Alain Grisay, chief executive of F&C Asset Management, describes the distribution of Friends Provident’s 52 per cent stake in the group as an “unshackling”. But when the liberated F&C – and 100,000 new shareholders – stagger blinking through the prison gates into the sunlight today, what will they find? Extra liquidity in the shares, for sure, and quite probably more volatility. Average daily trading volume in the shares has quadrupled in recent months as demerger day has approached. There are no declared short positions, but there will be sellers: sceptics worry about dividend cover and the ongoing security of Friends Provident’s investment mandates.

But such concerns ought to be overridden by celebrations of F&C’s independence. On 8 times Altium’s forecast of earnings for 2010, F&C trades at a discount to rivals such as Aberdeen Asset Management. It claims its Friends mandates ought to be reinforced by the share distribution (because some move on to five-year contracts). More important, improved performance of the underlying funds should foster client loyalty. That, in turn, would support the 9 per cent yield.

Mr Grisay has been lucky. Two years ago, his preferred route to independence might have been a leveraged buy-out. But a heavily indebted F&C would now have little chance of becoming the consolidator he wants it to be. So the timing is good. But like a man who has put his life on hold while fighting a wrongful conviction, Mr Grisay is on his mettle to prove he can make the most of F&C’s freedom.

Failure to develop

No need to worry about shareholders behaving like absentee landlords at Photo-Me International. They’re more like permanent lodgers. Two of the biggest are on the photo booth operator’s board – again. Serge Crasnianski, former chief executive, has been named deputy chairman and interim chief executive. Meanwhile, Dan David has set some sort of governance record, rising in 41 years with the group from executive to chairman to life president before returning on Thursday, at 80, as a non-exec. Photo-Me says Mr Crasnianski’s “knowledge of the business will be most useful to the new CEO”. But that hardly bodes well for any candidate seeking to put his or her stamp on the company, or move it forward. The pair, who together control more than 35 per cent of the group, should do the honourable thing and offer to buy the minority shareholders out of their misery.

andrew.hill@ft.com

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