In the news: Howard Davies

The London School of Economics will be hoping that its choice of new director will bring energy and dynamism to the institution despite complaints that the last organisation he led "fell asleep on the job".

Sir Howard Davies stunned the financial world last week when he resigned as chairman of the Financial Standards Authority to take over from Anthony Giddens at the LSE. It was a shocking career switch, not only because merely weeks ago he was being widely tipped be the next governor of the Bank of England (he has already served as deputy), but also because his departure from the FSA was seen by some as badly timed.

Last month, the Consumers' Association accused the City watchdog of having "fallen asleep on the job" in its handling of the endowment mis-selling scandal.

Sir Howard, 51, whose recreations are listed in Who's Who as "cricket and children", will start at the LSE next October, four months earlier than he had intended to leave the FSA. "I'm absolutely thrilled to have been appointed to this new job. The LSE has always had a fine reputation both here and abroad," he said.

Sir Howard was born in Manchester - he is a "die-hard City fan" - and read modern languages and history at Merton College, Oxford, where he also edited the student newspaper. He worked at the Foreign Office and the Treasury before studying at Stanford University for a year, then working for the management consulting firm McKinsey & Co. Among his high-profile jobs, he has served as director-general of the Confederation of British Industry.

Despite experience as a governor at De Montfort University, Sir Howard is the latest in an lengthening line of university heads without an academic background. But he does not see that as a problem. "I've always kept one foot in higher education," he said. "I see it as a liberating move. It's a very exciting time to be in higher education and it'll be a terrific challenge."