A "Cencelli" handbook of a bank and of the Country

In the first Republic, ministries were assigned according to a mathematical formula invented by the Honorable Cencelli: each political current had the right to a number of seats that was proportional to the votes received. The "Cencelli" handbook was a symbol of the deep-rooted corruption of the era in which the Christian Democrats dominated politics: patronage politics, the fratricidal fight between political currents, and the exasperated proportionality in allocating power that prevented any decision from being taken.

The secret instructions on the internal promotion criteria used at Banca Popolare di Milano (Bpm), published recently by some dailies, are exactly the transposition to the economy of the Cencelli handbook. The positions are assigned on the basis of the belonging to the different union groups: an executive for every group, as if it were a life annuity. Within the group, what counts is the loyalty to one's union current. Among all the promotion criteria, there is no trace of meritocracy. These are the people that should manage the credit to our companies. Is it surprising if we do not grow?

What is most shocking is not just that this handbook exists, but that its publication did not prompt any denial, or any resignation. Either it is a fake, which has to be immediately denied, or one cannot understand why the chief executive, the director general and the board of directors did not resign. By not resigning they are supporting this system. And since in Italy just few people resign, it is not comprehensible why the Bank of Italy does not rush to place the bank into extraordinary administration. What guarantees of stability does a bank whose executives were chosen based on their political affiliation offer? When the news came out, the share price on the stock exchange even rose, because it is not news: this is how Italy works. Or better, this way Italy proceeds, because one cannot say that it works.

We would like to believe that the problem is limited to Bpm. Unfortunately it is more widespread. A Confindustria study shows that 80% of Italian managers think that the most important factor to financial success is the "acquaintance of important people". Skills and experience are fifth after, among other things, "loyalty and obedience". From case to case, the relevant affiliation changes: a catholic association, a Masonic lodge, a mafia clan or more simply the right town (according to Bossi, Grilli has to go to the Bank of Italy not because he is good but because he is from Milan). But the result does not change: the comrade is favored over merit. In the second Republic, the Cencelli handbook is even considered a noble example: now posts are assigned based on sexual favors rendered.

This transposition of the Cencelli handbook to the economy is the reason why in Italy there are the best secretaries and the worst managers. In a system that does not reward merit, a lot of people, especially women who would have the capability of being managers are confined to the role of secretaries. While managerial posts are assigned to who is well introduced, also if often ineffective. This clientelism is the reason why both in our Country and in Bpm there is a deep financial crisis.

This method makes our companies inefficient and destroys the desire in young people to study. Why make an effort studying if one is rewarded not by knowledge but by acquaintances? This way young people invest in personal relations, useful for political relations and not in know-how to export to China. Maybe it is no chance that our industrialists moved to the utility sector, where relations with the regulator are especially important. It is the theory of comparative advantages.

When a company has a culture it works and it is purchased or, sooner or later, it goes bankrupt. In a democratic country like ours there is also hope for renewal. But a change in power is not enough, a cultural revolution is needed. Without this revolution, Italy is destined to its own fate: either a takeover by Frankfurt or bankruptcy.

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