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Blog series – Giles Cuthbert

In advance of our event at the Bank of England on 21 March 2017, we asked interested parties to write on the theme: Worthy of trust? Law, ethics and culture in banking…

Law creates the framework within banking operates, it provides banks with the protections they need to flourish in a modern mercantile environment. Society benefits from this, the social purpose of banking enhances the society we live in, allowing businesses to thrive and individuals to prosper.

However, the law by itself will not always be effective in affecting the behaviour of bankers, and indeed we do not want our bankers simply to follow the letter of the law. We want our bankers to be professionals who take wise, prudent decisions.

In terms of ethics, what do we hope for from our bankers – I would reiterate that if we simply expect them to follow rules and guidelines then we will never succeed in creating a culture where thoughtful stewardship lies at the forefront of a banker’s mind. Rather we will create an environment whereby we have bankers who strive to follow rules, but will not develop ways of ethical thinking, and ethical awareness. They will simply wait until a legal issue hits them, or perhaps deal with other ethical challenges from the perspective of risk management.

Culture cannot simply be viewed as a feature of one organisation. For the culture of an organisation is formed in part by the society and world in which we all live. We do, therefore, to a certain extent, get the cultures which we desire. We may think otherwise, but it is our demands and requirements as a society which drive the behaviours in banks and other organisations. We need to be thoughtful as consumers, investors, regulators and stakeholders as to what behaviours we are really driving. Are our actions likely to create the organisational cultures we really want.

So what is the solution? We need bankers who are thoughtful professionals, who work within the framework of law, regulation and codes of conduct. We also need bankers to feel proud of their

professional approach, and their contribution to a socially purposeful industry – to their profession. Critically, however, they must be knowledgeable professionals who bring their professional judgement to bear on ethical dilemmas. Only then will they be able to deliver trustworthy ethical banking with a social purpose. Without knowledge, ethics and professionalism a banker is not be worthy of our trust.

I would argue that it is integrity that pulls all this together – integrity reflects a notion of wholeness, that we are consistent in our actions and ethics whether at home or at work; in our private life or our public life. If we start developing different codes for ourselves in different spheres then we have to ask whether we are acting with integrity. Of course the behaviours need to vary – but the ethics which drive those behaviours do not – so the way I may show compassion to my child will be very different from the way I demonstrate compassion to a colleague- but the ethical value of compassion will remain unchanged.

Trust is given to those who show integrity; and it is integrity that leads us to support a healthy culture and a respect for the law, alongside a virtuous approach to ethics.

Giles Cuthbert, Managing Director, Chartered Banker Institute

Senior Managers and Certification Regime

Exploring how the SMCR - and especially Certification - can be implemented in the most effective way across the sector.

The Senior Managers and Certification Regime is a major regulatory change that will affect all banks and building societies. Responding to recommendations by the Parliamentary Commission on Banking Standards, the government and regulators have together developed a comprehensive framework to ensure better accountability and responsibility for behaviour, competence and culture in banks and building societies. The new framework provides an opportunity for the industry to focus on and demonstrate a culture of professionalism. We are working with firms and regulators to facilitate this, including areas where a common approach across firms could support both the objectives of the regime and the skills and development of the people covered by it.


Evaluating whether a more 'professional' approach to banking would improve behaviour and competence across the industry.

The Parliamentary Commission on Banking Standards found that 'banking culture has all too often been characterised by an absence of any sense of collective responsibility to uphold the reputation of the industry', and argued that a greater focus on professionalism could be an answer to this. Working with a leading team at the University of Leeds, we are researching the issues around professionalism in banking. In particular, we are reviewing how professional qualifications are currently used across the sector, and at whether a stronger role for professional bodies, along the lines seen in some other sectors, like medicine or law, would help raise standards. To inform this work and develop a rounded picture of 'professionalism' and what it means in banking, we are surveying banks and building societies, professional bodies and a wide range of other interested groups, including consumer bodies and investors.


Providing an honest and impartial assessment to Boards of progress against objectives on behaviour, competence and culture.

The BSB assessment exercise presents Boards with an objective and impartial view of their firm's culture, identifying where things are working well and recommending areas for improvement. It draws on information not only from Boards and senior teams, but also from employees, investors (or members), trade unions, customer groups and other relevant bodies. In doing so, it will provide constructive challenge to each firm individually, while building a collective understanding of common issues across the industry, or sectors within it. We undertook our first annual assessment exercise in 2015 with ten firms (Barclays, Citi, HSBC Bank, Lloyds Banking Group, Metro Bank, Morgan Stanley International, Nationwide, RBS, Santander UK and Standard Chartered). The BSB itself will not publish individual assessment reports - each firm owns its own report - but key themes and messages will be set out in the BSB's annual report, the first of which will be published in Spring 2016. Given that Board engagement is central to the assessment work, only firms that have their headquarters in the UK are eligible for the full assessment exercise. All firms, including branches of firms headquartered overseas, will however be included in a focused membership-wide survey, which will allow each participating firm to benchmark itself against its peer group.



If your bank/building society has not responded adequately, or in time, to a complaint that you have already made, you can register your complaint with the Financial Ombudsman Service. Which offers a guide on consumer rights when taking a complaint to the Financial Ombudsman Service.


If you have a problem or query relating to your financial affairs, or are seeking personal finance advice or guidance, there is free, impartial information available from the following organisations:


If you work in the financial services industry and are concerned about any activities conducted by your employer or any other firm or individual, you may find the Financial Conduct Authority and the Prudential Regulation Authority's guidelines on whistleblowing helpful. It explains what constitutes whistleblowing, and what procedures are in place to respond to blow the whistle and how your anonymity would be protected. Public Concern at Work, the whistleblowing charity, also offers support and advice to individuals and employers about how to report concerns and how to establish whistleblowing frameworks.


If you are seeking the services of an independent financial adviser, Unbiased may be able to help, or if you are looking for more general financial guidance, the Money Advice Service may be a useful place to start.