The body set up to improve standards and bolster the industry’s reputation in the wake of the Libor-rigging crisis, handed over their first report cards for Britain’s major banks.
The assessments of the behaviour and culture inside the major banks were linked to the reports delivered by auditors by Dame Colette Bowe, chair of the Banking Standards Board (BSB). The report was signed off by the partner at the accountancy firm which has assessed their books and is included in their annual reports.
The BSB will publish its own annual report in the spring.
“The report that goes back to the banks will be signed by me,” said Bowe.
A selection process that was led by Bank of England governor Mark Carney chose Bowe for the job of chair of the new body.
While not being specific about how the banks would make them known, Bowe expected the reports to be published in some form. She however suggested there could be some reference to the assessments in the upcoming annual reports.
The founder members – Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland, Santander and Standard Chartered and Nationwide Building Society were sent the report. Three banks that have seats on the board of the BSB – high street bank Metro and the investment banks Citi and Morgan Stanley, were also sent the report.
“I wrote to the chairman of each of the seven founding banks and three on the board and said [to them] ‘you tell us what it is you think your bank is there for, what are you trying to achieve, how you are trying to achieve it and how do you know [you are achieving it]’” Bowe said.
In order to assess whether the goals and ambitions set by the board and its management were filtering through and being achieved, a team of interviewers then spoke to 200 groups of staff inside the firms.
The aim of the report is to boost the standing of the banks with the public after a string of scandals, ranging from rigging Libor to mis-selling payment protection insurance and not to achieve a single standard of behaviour but meet their own internal goals.
“Individual firms will start looking at culture from different starting points. For some institutions it may be ‘how do we change our culture’, for others it may be ‘how do we maintain our culture’, for other firms the challenge could be ‘how do we create an identity and hold on to it’,” Alison Cottrell, hired from the Treasury to be chief executive of the industry-funded body, said.
After conducting a review for the major banks on how to improve their reputation, the idea for the annual report cards came from Sir Richard Lambert, the former Financial Times editor and former chairman of the employers’ body the CBI.
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