Object 2: Business rules, 1792

Andrew Berkeley Drummond’s business rules, 1792

Andrew Berkeley Drummond’s rules for the conduct of business at the house of Messrs Drummond, 1792 © RBS

By 1792, Drummonds' was one of London's long-standing banking names, still run by the family of its founder, Andrew Drummond. In 1787 Andrew Berkeley Drummond – great-nephew of the first Andrew – became a partner. He soon grew concerned that the firm was losing sight of the core principles that should govern it. In 1792 he set down these rules, laying out his vision for how things should - and in future, would - be run. He began, 'The first rule never to be departed from on any account whatever is to make the welfare of the Customers the first Object'.

Andrew Berkeley Drummond had a very personal reason for wanting to overhaul the family business. When he first joined the firm in his early 20s he was, by his own account, not thrilled about becoming a banker. He was a dutiful young man, and he fulfilled his obligations conscientiously, but he had no passion for the career that had been laid out before him.

The Rules he defined in 1792 were just one demonstration of his commitment

Portrait of Andrew Berkeley Drummond

That all changed when Drummond discovered one day that his own father – a partner in the business – had got himself into debt with the bank. It was normal at this time for bank partners to borrow money freely and without limits, but Drummond’s father was taking too much, and not paying it back. Drummond said later, ‘this slight conversation made me at least so far a man of Business as to determine me to turn the whole Bent of my Mind and thoughts to the Investigation of my Father’s affairs and those of the House…’. So it was that crisis and the risk of letting customers down gave Andrew Berkeley Drummond something that the prosperous and peaceful bank never had; a sense of purpose.

Young Drummond believed that ‘nothing can be more mean and despicable’ than a banker who acted only in his own and his friends’ financial interests. But he saw an alternative; for, in contrast to his youthful indifference to banking, in later life he insisted that ‘although there may be more brilliant walks in life, I confess I see few more useful or more truly honourable’ than being a banker of honesty, principle and integrity.

He dedicated himself to making sure that Drummonds was just such a bank. He strove to improve governance, limit the partners’ borrowing and ensure that sufficient reserves were kept to ensure that no customers would suffer in the event of disaster. The Rules he defined in 1792 were just one demonstration of his commitment. He knew that maintaining high standards of integrity was a constant battle, and that what he called ‘general sentiments’ – received wisdom without real moral commitment – could never provide immunity against weak human nature or poor judgement.

Andrew Berkeley Drummond wanted every representative of the bank to understand the obligations that came with his position. From 1812 until his death in 1833, each time a new partner entered the firm he wrote him a long and detailed letter, setting out once again his vision of what customers should expect from their bank.