Gogarburned: Little guys put the heat under RBS bosses

For around two hours a year, the captains of industry are adrift, rudderless, out of control. They are at their annual general meetings, and at the mercy of their shareholders.

The votes are all sewn up, of course. Institutional investors have been courted, lobbied, reassured and sometimes even listened to. That's all behind closed doors.

In the case of Royal Bank of Scotland, all they have to do is persuade the Chancellor of the Exchequer, or at least the person who runs his financial investment arm. The public's majority stake does the rest.

So of 22 votes taken at this year's AGM, none got less than 97% support, and only three got less than 99%.

However, during the annual general meeting, a handful of shares is enough to give the floor over to the li'l guy - the chance to hold the directors to account, to humble them, or to voice your accusations about the corporation's various misdeeds.

With the occasional exception of the chief executive, and more rarely the finance boss, other directors sit, poker-faced and silently very relieved, as the chairman takes any flak that's flying.

Sir Philip Hampton has faced seven such meetings as chairman of Royal Bank of Scotland. His final appearance at the bridge of the patched-up, slow-moving and humbled hulk that is RBS was one of the stormier encounters this captain of commerce has faced.

You could tell that his inquisitors had become familiar to him, through dogged complaining, legal action and previous questions at AGMs.

The trick, as he displayed, is to keep very calm - not to respond in kind to the various accusations of criminality, not to threaten lawyers, to disagree very politely, and to invite the questioners to keep going and going and going until they eventually run out of ammunition. The best hope is that others attending the meeting will become restless and start pushing for the questions to end. Coffee and biscuits await, and there are trains to catch.

No such support came over the horizon for Sir Philip Hampton at his Gogarburn headquarters on Tuesday. He had to field the sustained attacks on the bank's lending to local councils, its closure of branches, its admission of guilt in rigging markets, its share price's under-performance, and above all, his handling of complaints.

In particular, this concerned the now notorious GRG - the Global Restructuring Group. This was the division of RBS that took on business customers in financial distress, and not always when the company boss agreed they were in distress. The special measures imposed by GRG were, we're told, at inflated prices, heavily weighted to the bank's interests, and often fatal to the small business.

The stories about GRG's mis-treatment of customers fill a sizeable corner of the internet. It was pointed out that it's possible for the USA's mighty Securities and Exchange Commission to extract a guilty plea from RBS, but not for lesser mortals. The failed attempts to get an admission of wrong-doing for small-scale customers has driven some to fury and, one suspects, obsession.

The bank's response has been to call in independent inquirers, including a blue chip law firm - which is just one reason why this is not the place to report the (arguably) defamatory things said about them and the reports they compiled.

What was clear was that Hampton - on his way out to chair pharma giant Glaxo Smith Kline - has become the bad cop in the partnership with chief executive Ross McEwan. The New Zealander and retail bank specialist has gone out of his way to keep communications open to the bank's critics, for which he was praised. Or at least, he wasn't criticised for being "psychopathic".

Will they get satisfaction? That's down to future AGMs. But Mr McEwan used this one to set out a bit more detail on his priorities for the next five years. His predecessor, Stephen Hester, set out a three-to-five year recovery plan. That now looks more like 10 years.

McEwan's special brew for turning RBS around stretches to 2019-20, by which time he envisages a bank that's shed almost all its "exit bank" by the end of next year. That's the troublesome bit it doesn't want any more, as opposed to the "go-forward bank". It's intended to shrink from most of its international presence into its UK and Ireland base, with 85% of it in retail and commercial, rather than the risky investment stuff.

Both shrinking and selling off assets, such as its American subsidiary, Citizens Bank, should help the process of building up core capital reserves to 13% of its exposure to risk. And once that's in place, shareholders were being told that they might eventually get back to dividend pay-outs. It's been a long wait, just as the share price has been stuck. And there's still no hint of a timetable.

The bank has shed £1.1bn in its cost base, and shrunk from seven to three customer divisions. It still has a whole lot of problems in the pipeline from litigation and "conduct issues" - by which they mean mis-selling and market rigging.

Part of the response to such problems is more "diversity of thought, which in turn improves employee engagement, innovation and decision-making", says McEwan.

That means a lot more women at senior levels, allied to a bid to become the bank that understands any distinctive requirements for women in business.

Will that mean a return to the "ladies' branch" - a genteel Edinburgh institution at the west end of Princes Street with a powder room and space to park your shopping, which closed 18 years ago? Well, probably not.

The shareholders who wanted branches to be saved from closure were given little reassurance. Customers are increasingly banking on their phones and tablets. Apparently, the busiest "branch'" for RBS, or its NatWest brand at least, is the commuter train from Reading to Paddington Station in London.