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Annual Review 2016/2017

III: Policy work in 2016

Certification Regime

We published a consultation paper proposing good practice guidance on assessing F&P in June 2016. Following consideration of the responses by the Working Group, this was followed on 28 February 2017 by the BSB’s first Statements of Good Practice on Fitness and Propriety Assessment and supporting guidance.

Background to the publication of the good practice guidance

The new Certification Regime commenced on 7 March 2016. It requires senior managers to attest annually to the ‘fitness and propriety’ (F&P) of individuals who are managing significant risks. These employees, along with almost all employees in a bank or building society, are also required to act in accordance with new Conduct Rules introduced on the same date.

While the new regulation is clear in its requirement that firms assess the F&P of certified individuals, it leaves the detail of how this should be done largely to firms themselves. In this, it presents firms, therefore, with the collective opportunity to generate far-reaching and positive change through the raising of professional standards across the sector. The new regulatory requirements of the Certification Regime are, seen through this lens, a starting point rather than an end in themselves.

Given the importance of the new regime to standards of both behaviour and competence across the banking sector, the BSB explored with its members the scope for both learning from each other about implementation of the new regime and identifying areas where consistency of approach could be beneficial.

Following these initial discussions, a Certification Regime Working Group drawn from BSB member firms was convened in January 2016 to help to develop a common understanding of the policy and operational issues associated with the Certification regime and to establish good practice guidance and examples. The group met nine times in 2016 and its membership expanded and diversified over this period.

The culmination of the Working Group’s efforts is the publication by the BSB of two documents designed to help firms to use the Certification Regime as a means of raising professional standards. These are:

An analysis of the feedback received during the consultation exercise can be found in the consultation report. The main changes in light of the feedback received during the consultation were:

  • the F&P Assessment Principles document is now the primary Statement of Good Practice, with all other documents acting as Supporting Guidance;
  • the Definitions, Sources of Information and Assessment Record Template have been combined into a single piece of Supporting Guidance;
  • the definition of ‘honesty and integrity’ has been changed
  • the Sources of Information have been changed to provide greater clarity on which sources of information are appropriate for different types of assessment (e.g. annual assessment, new to role assessment) and to provide greater clarity as to when some sources of information are likely to be relevant to the consideration of a person’s fitness and propriety; and
  • the Assessment Record Template has been shortened and simplified.

The work of the Certification Regime Working Group on assessing fitness and propriety continues, and further proposed Statements of Good Practice and Supporting Guidance will be published for consultation during 2017 covering issues such as:

  • identifying and evaluating risks and issues related to Certification i.e. circumstances which, should they materialise, could call into question whether an individual is fit and proper to perform their role;
  • assessing the F&P of individuals working outside the UK or moving to the UK from overseas; and
  • factors to consider when sharing information about Certified individuals when they move between firms (linked to recent requirements for firms to provide ‘regulatory references’).

BSB Certification regime podcast

Listen to some of the members of the BSB Certification Regime working group discuss some of the key challenges of implementing an industry-wide approach to the certification of F&P in our podcast.

Play podcast

Professionalism

The purpose of the next phase of the BSB’s work on professionalism is to identify how the recognised potential for professional bodies and other qualification providers to play a significant role in raising levels of competence and ethical behaviour in the sector, can be realised; this will also include consideration of the role of professional qualifications. Find out more…

PROFESSIONALISM IN BANKING REPORT

The independent report that we commissioned from the Inter-Disciplinary Ethics Applied (IDEA) Centre at the University of Leeds concludes that the potential exists for professional bodies to play a greater role in raising levels of competence and promoting ethical behaviour in the banking sector.

Learn More

DAME COLETTE BOWE ON PROFESSIONALISM IN BANKING

Following the publication of the report we commissioned from the University of Leeds, looking at the role of professional bodies and professionalism in banking more widely, our Chairman Dame Colette Bowe spoke at a CSFI event on this topic.

Learn More

BANKER OF THE YEAR AWARD

BSB supports Chartered Banker Young Banker of the Year 2016 competition. Awards like this are an important way of recognising and encouraging future leaders in banking for the right reasons: not just for their contribution to their firm, but for improving outcomes…

Learn More

THE BSB PROFESSIONALISM FORUM

The purpose of the next phase of the BSB’s work on professionalism is to identify how the recognised potential for professional bodies and other qualification providers to play a significant role in raising levels of competence and ethical behaviour in the sector, can be realised.

Learn More

Learning from other sectors and jurisdictions

We held a series of popular breakfast seminars for member firms in 2016 with non-banking sector speakers, talking about the challenges relating to trustworthiness in their own sectors, and about leadership, culture and professionalism:

Breakfast seminars

SIR MARTIN NAREY

Former CEO of the National Offender Management Service, Director-General of the Prison Service and Chief Executive of children’s charity Barnado’s. Martin also carried out an authoritative review on behalf of the government on the effectiveness of UK Adoption Services.

View event

JORIS LUYENDIJK

Author and broadcaster and journalist. Joris used to write the Guardian’s banking blog, but is best known for his widely acclaimed international best-seller Swimming with Sharks, which he describes as ‘My journey into the world of bankers’.

View event

PROFESSOR MARTIN ELLIOTT

Professor Martin Elliott led the cardiorespiratory and thoracic transplant teams at GOSH for many years, and established, and is Director of, the National Service for Severe Tracheal Disease in Children, the largest such service in the world.

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MARK ENGLAND

Team GB’s chef de mission for the Rio Games. After the runaway success of Team GB at this year’s Games, Mark will speak to our invited audience on the topic of integrity in sport.

View event

Ethnography workshop series

We are now offering our member firms a series of workshops taught by Dr Daniel Beunza, Assistant Professor of Management at the London School of Economics. Dr Beunza is a specialist in the use of ethnographic techniques and has deployed them in a range of studies examining, for example, the automation of the New York Stock Exchange, a derivatives trading room on Wall Street, and the way in which shareholder groups engage with corporations.

View workshop

Worthy of trust? Law, ethics and culture in banking

We look forward, on 21 March 2017 to a planned discussion on ‘Worthy of trust? Law, ethics and culture in banking’ between William C. Dudley, President of the Federal Reserve Bank of New York, Mark Carney, Governor of the Bank of England and the Right Honourable Lord Thomas, Lord Chief Justice of England and Wales at a BSB event hosted by the Bank of England.

 

In the run-up to the event we will publish a series of think pieces on the site from BSB Board members, external parties with whom we have collaborated over the last year and other parties with an interest in the topic. Read the first piece from Professor Onora O’Neill.

Update: Download the brochure (pdf 4.5MB) from the 21 March event, pulling together the full blog series, panellists’ remarks and recording of the event.

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