Barings collapse (A): Breakdowns in organizational culture & management

By Stewart Hamilton, Donald A. Marchand and Alicia Micklethwait

17 pages

March 1996

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Reference: IMD-1-0155

This case is designed to give an overview of the collapse of a prestigious financial institution and the organizational failings that contributed to it. The case outlines the history of Barings Bank, the creation of its securities business, particularly in the Far East, and how Nick Leeson, a Barings trader in Singapore, was able to run up massive losses in derivative trading which caused the collapse of the bank. The case identifies the cultural clashes, remuneration system, control failings and other issues which severely weakened the effectiveness of the matrix management system, an important contributor to the collapse.

Keywords

Collapse, Matrix Management, Culture, Banking

Settings

United Kingdom
1995

Type

Published Sources

Available Languages

English

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This case study is part of a series

Barings collapse (A): Breakdowns in organizational culture & management
Barings collapse (B): Failures in control and information use

1999 ECCH AWARD WINNER (Finance)

This case study is part of a series

Barings collapse (A): Breakdowns in organizational culture & management
Barings collapse (B): Failures in control and information use

Barings collapse (A): Breakdowns in organizational culture & management

By Stewart Hamilton Donald A. Marchand and Alicia Micklethwait
Case reference: IMD-1-0155 ©1996

Summary

This case is designed to give an overview of the collapse of a prestigious financial institution and the organizational failings that contributed t...

1999 ECCH AWARD WINNER (Finance)

Reference IMD-1-0155

Available Languages English

Contact

Research Information & Knowledge Hub for additional information on IMD publications