Was there ever a more unsatisfactory appointment than that of Lord St John of Fawsley as the senior non-executive director of BSkyB? The former Tory arts minister finds himself playing a pivotal role in the best drama in town, the succession plan at the satellite TV firm. On one side is the chairman, Rupert Murdoch, who is pushing to have his son James, 30, installed as chief executive. On the other, BSkyB's outside shareholders are determined that there should be no nepotism and that the best candidate should get the job - the plummest and the highest paid in British commercial TV.
In the middle, supposedly making the choice and keeping Rupert at bay, is Lord St John. He has little credibility in the City. He's been on the BSkyB payroll for 12 years, which means he has lost any claim to be independent. Erudite, arty and fastidious, he has little business experience and gives the impression of being a bit embarrassed about drawing a large chunk (£40,000 a year) of his income from something as vulgar as a populist TV station.
Curiously, his lengthy Who's Who entry goes into minute detail about his achievements in the arts and politics and is six times longer than Rupert's, yet omits any mention of BSkyB. I'd give you a penny to a pound that if his Northamptonshire rectory boasts a Sky dish at all, it is very well concealed.
Yet it is a board committee headed by Lord St John that BSkyB shareholders, employees and viewers have to rely on to ensure the best candidate succeeds the outgoing Tony Ball.
An ardent admirer of Oscar Wilde, Lord St John is fond of the telling quip. When asked if Murdoch Sr should step down as chairman if his son became chief executive, he riposted: "When you next meet the Queen, I suggest that if you want to have a constructive conversation, you do not suggest that she abdicates."
Very droll, no doubt, but it's looking good for James that BSkyB's senior independent director - a figure charged with curbing excess boardroom power and protecting the interests of outside shareholders who own 70 per cent of the company - appears to regard it as a hereditary monarchy.
The £7.5m fine meted out the other day by Postcomm to Royal Mail underlines how lightly some of our biggest financial institutions are getting off - for much more serious crimes. Five days earlier, for example, Lloyds TSB was fined a comparatively modest £1.9m by the Financial Services Authority.
While the posties were guilty of nothing more than incompetence, the sins of Lloyds TSB - a comparable-sized organisation - are harder to forgive. Bluntly, the bank deliberately identified vulnerable customers and fleeced them.
The authority ruled that Lloyds TSB had mis-sold its so-called high-income bonds to 22,500 people. These products offered enticing rates of interest, but there was one problem: investors' capital was not guaranteed. Branch staff pinpointed people with big savings balances (usually the elderly) and persuaded them to take the plunge.
These share-market-linked bonds - since dubbed precipice bonds - were patently unsuitable for these people, who wanted capital security above all and for the most part had never before touched a share in their lives. But Lloyds TSB branch staff, motivated by an enticing bonus scheme and encouraged by their managers, persuaded them otherwise.
Some commentators have labelled the victims greedy and/or stupid. They were neither. For the most part, they were just trusting and naive. Although it has paid out £98m in compensation, no heads have rolled at Lloyds TSB. No staff bonuses have been paid back. No one has been reprimanded.
That is the reason why there will be more mis-selling scandals. If the FSA wants to stamp out future scams, it could start by banning the words "bond" and "guaranteed". "Bond" is a totally meaningless term that can be applied to any old rubbish. And nothing in this life is guaranteed, least of all a future financial promise.
Sad news for insurance executives who like to froth about the unstoppable onslaught of the compensation culture. One senior figure at Lloyd's of London likes to tell the tale of Merv Grazinski of Oklahoma, the driver of a mobile home who successfully sued the manufacturer, Winnebago Industries. While speeding along the freeway at 70mph, Grazinski decided to leave the wheel to go and make himself a cup of coffee in the back of his gleaming new 32ft motorhome. Winnebago, it is claimed, had to pay out $1.75m after the inevitable pile-up for negligently failing to spell out in the handbook that the vehicle needed to be steered at all times. Alas, the story is a complete fabrication, a helpful lady at Winnebago's HQ in Iowa tells me.
Patrick Hosking is deputy City editor of the London Evening Standard
