In 2017, the board of HSBC made a landmark, even radical, decision: they appointed an outsider as Chairman.

Having installed Mark Tucker in the role, they were obliged to appoint an HSBC lifer as Group CEO. Having two outsiders with little knowledge of the sprawling beast that is HSBC would have been a risk too many.

John Flint was available, if not optimal, and he would have had the backing of outgoing Group CEO, Stuart Gulliver.

Now Tucker, having disposed of Flint, clearly knows (or believes he knows) what needs to be done to improve the group’s performance. There are likely to be many new faces at HSBC, as well as the one in the Group CEO’s office.

Tucker and his team face a tricky task.

Chairman John Bond – 1998-2006 – sought through acquisitions, most disastrously in the USA, to turn HSBC into ‘The World’s Local Bank’ and failed. The financial crisis of 2008/9 and the subsequent revelations of unethical conduct by HSBC, most notably money laundering for drug cartels in Mexico, did lasting damage to the group.

Chairman Douglas Flint and Group CEO Stuart Gulliver skillfully worked at clearing up the mess, cutting costs, closing or disposing of underperforming businesses. They both retired in 2017.

The challenge for team Tucker will be to complete the work of their predecessors while creating a long-term growth strategy in HSBC’s core Asian markets. The former will be considerably easier than the latter.

In pursuit of a better return on capital, a policy that would win the praise of the board and delight shareholders, they could reassess the scope and value of the US business, review some of the Latin America operations and contemplate an exit from private banking.

China is far a greater challenge.

In the past 25 years, the competence and confidence of Chinese financial institutions have vastly improved. They no longer look to the West for expertise and guidance, especially so after the 2008/9 crisis.

And their ethics and values are significantly different in the area of corporate governance. The spat over Huawei, with Beijing taking the view that HSBC had given far too much confidential information about the company to US regulators, is indicative. And the recent experience of Cathay Pacific suggests this was not an isolated incident. International companies operating in China will need to radically reassess their HR and governance policies.

Further, Chinese nationalism would suggest, quite understandably, that they see no good reason to do favours for foreign banks.

Last, there is politics. HSBC, founded in 1865, is headquartered in the UK and yet makes most of its money in Asia. The UK Government has neither the clout nor the will effectively to protect or advance HSBC’s interests. The bank is a splendid and resilient colonial relic.

But inertia may be on the side of the bank. Customers are traditionally reluctant to move their business to alternative suppliers. So a significant negative effect of Chinese headwinds may be delayed for a few more years.

However, the current HSBC board and future members should consider carefully the words of former US Secretary of State, Dean Acheson, who infamously remarked in 1962 that ‘Britain has lost an empire and not yet found a role’. The same could be said of the bank.

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