1 The Denial of Ethics? Leadership and Masculinity in the Financial Sector David Knights Lancaster University Management School, UK; Open University Business School, UK. email david.knights11@outlook.com For publication in The Routledge Companion to Leadership edited by John Storey et al. 2016 Acknowledgment: I thank Peter Case for providing very useful comments on an earlier draft of this chapter. Introduction Despite numerous signs of imminent disaster at the turn of the century, the global banking crisis of 2007/8 can be traced to the collapse of the wholesale market for credit once Lehman Brothers filed the largest bankruptcy in US history (Li et al., 2012; Knights and McCabe, 2015). No doubt, the crisis and the enormity of the government bailout for what previously were mighty corporations shocked the world, as its global impact and severity was felt on affluent livelihoods that had become so taken for granted since the end of the Second World War. Ordinarily traumas of this nature result in radical departures from the conditions of life that could be identified as contributing to the crisis but this seems not to have happened several years after the events of 2007/8, for the sector including its governmental guardians/ regulators remain in denial about the scale of the ethical transformations that are needed. Many of the conditions that made the crisis possible were the neoliberal culture/ ideology and its faith in ‘free markets’, economic growth and heroic leaders as the panacea for all the ills of society. This combination of beliefs set the scene for the economic deregulations of the 1970s and 1980s that were perceived as the litmus paper for unleashing a proliferation of entrepreneurial creativity, imagination and leadership. Of course, deregulation did not have a wholly free reign as a limited range of regulatory controls over organizations and institutions and especially the financial sector were deemed necessary accompaniments to the ‘free market’ movement in Western economies (Morgan and Knights, 1997). These new regulations were designed, however, to facilitate the growth and development of market relations, not to restrain them. So, for example, in UK financial services, regulations at the point of consumption not at the point of production were introduced since these were deemed to protect retail consumers from unscrupulous selling (Knights, 1997) without repressing innovative leadership and strategies. Product innovations of the kind that simply facilitated the circulation of financial instruments without adding value in wholesale markets were not constrained by the new regulations. Indeed, according to Finance Maps of the World i one of the most important objectives of the financial regulatory bodies was to sustain confidence in the financial markets. Nor were there any obstacles placed in the