Restoring trust in banking requires a cultural commitment reflected throughout the organisation, delegates told at Trust in Banking conference organised by Cambridge Judge Executive Education.
Restoring public trust in banking requires a cultural commitment that extends to every level of a bank’s organisation, delegates were told at the Cambridge Trust in Banking conference organised by the Executive Education division of Cambridge Judge Business School.
“Rather than patching up problems one by one as they become apparent, banks should integrate ethics into their corporate strategy,” says a research paper unveiled at the 20 October conference in London organised by the Centre for Compliance and Trust at Cambridge Judge.
“Any attempt to regain trust and define a target culture is inextricably bound up with the question of the social purpose of banks,” said the paper – entitled “Ethical banking – a primer.”
The paper was prepared by Jens van ‘t Klooster and Marco Meyer, PhD researchers at the Faculty of Philosophy at Cambridge University, who are members of the Cambridge-Groningen Trusting Banks research group.
The paper was presented at the conference by Alex Oliver, Professor of Philosophy at Cambridge University, who emphasised the importance of doing something because it is “right” rather than merely because “it says so in the rules” or it “promotes reputation.”
The financial crisis of 2007-2008 severely dented public trust in banking, and while the banking industry has made strides to restore it much remains to be done, the chairman of the Financial Conduct Authority, John Griffith-Jones, told 110 delegates at the daylong conference at the London Stock Exchange.
Trust “arrives by foot” and “leaves by horse,” he said, and the right words by chief executives are not enough because customers remember “the tone at the till” far longer than they recall “the tone at the top.”
Charles Roxburgh, Director General of Financial Services at HM Treasury, told the conference that the UK government “sees no tradeoff” between having the “best regulated and most competitive” banking sector, and said that any bank that fails to take culture and ethics seriously “won’t be around in 10 years.”
Helena Morrissey CBE, CEO of Newton Investment Management, talked about the lack of diversity at banks and other big companies, where women hold a very small proportion of executive positions, while Christoph Loch, Director of Cambridge Judge, added that organisations also need a “diversity of ideas” in order to spur motivation.
Paul Pester, CEO of TSB Bank plc, closed the conference with a keynote entitled “Can Bankers be Trusted?” – in which he talked about the transition at TSB from a sales-driven culture to a service-driven one, and how he believes increased competition in the sector will improve banking for the consumer.
Other speakers included Michael Roemer, Group Head of Compliance at Barclays Bank; Elisabetta Osta, Managing Director, Information, Insights and Innovation at Barclays; Professor David De Cremer, KPMG Professor of Management at Cambridge Judge; Iman El-Marashly, Doctoral Researcher in Financial Stability and Islamic Finance at Cambridge University; and Sir Peter Wall GCB CBE, Director, Amicus and former Chief of the General Staff of the British Army.
Sessions were chaired by Dame Sandra Dawson, KPMG Professor Emeritus of Management Studies and former Director of Cambridge Judge; Jaideep Prabhu, Professor of Marketing and Jawaharlal Nehru Professor of Indian Business & Enterprise at Cambridge Judge; and Peter Hiscocks, CEO of Executive Education at the School.