The Banking Standards Board, established to bolster the reputation of the industry, has yet to issue any standards nine months after formally being created.
The body, chaired by Dame Colette Bowe, was the industry’s response to the public backlash against bankers unleashed by the £290m fine imposed on Barclays for Libor rigging in 2012.
It was established on the recommendation of Sir Richard Lambert, a former editor of the Financial Times and ex-head of the CBI, the employers’ body. Lambert was commissioned by major banks to devise ways to help restore the sector’s fortunes. It formally began its work in April.
The body does not have any statutory powers. However, its role in assessing banks was one of the reasons cited in the Financial Conduct Authority’s decision to abandon a review into banking culture.
The revelation at the end of last year that the City regulator’s review had been dropped prompted a range of accusations about Treasury involvement - repeatedly denied - in encouraging a softer approach towards the financial sector.
In its first nine months the Banking Standards Board has measured banks against their own internal standards and sent them the first of what are expected to be annual reports on their compliance with their own internal goals. Bowe said last month that she expected these reports – sent to 10 major banks – to be published in some form although she was not specific about what form this would take.
Although there are not any industry-wide standards the board said it was working on ideas which could be adopted across the sector.
“We are currently exploring with firms, professional bodies and other organisations, areas of banking where new, cross-firm standards would be beneficial for customers, the sector and the economy,” the board said.
“It’s important that any standards issued are implementable, properly targeted, and don’t duplicate what is already out there. They need to be clearly differentiated from minimum regulatory requirements. And, in line with best practice in standard setting, there needs to be proper consultation for them to be effective.”
The accountancy body, the Financial Reporting Council, has also embarked on a review of culture, that goes beyond the banking sector. It said: “The FRC recognises the challenges that boards face when addressing the culture of their companies and in 2015 brought together a ‘culture coalition’ to highlight effective approaches and share good practice.
“The FRC is looking to understand the role of boards in shaping and embedding a desired culture, and will publish its findings in summer 2016.”
This article was written by Jill Treanor, for theguardian.com on Monday 18th January 2016 17.17 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010