Bankers should have to swear an oath of good service in the same way as doctors, a think-tank said today.
Rather than solely focusing on rules or marco economic issues, regulators need to consider the personal conduct of bankers, said ResPublica, an independent think tank that looks at social, economic and cultural problems.
The call for stronger ethics in banking comes after a series of scandals such as the mis-selling of payment protection insurance, Libor rate rigging, mis-selling of interest swaps to small businesses and even money laundering.
ResPublica called on trade bodies British Bankers’ Association (BBA), the Building Societies Association and the new Banking Standards Review Council to adopt an oath it has drawn up for members.
The body’s full report, called Virtuous Banking: Placing ethos and purpose at the heart of banking, will be launched on Tuesday by the chairman of the Banking Standards Review Council, Sir Richard Lambert.
The think tank’s banking oath is based on the Hippocratic Oath doctor’s swear to, which dates back 2,500 years to Greek medical pioneer Hippocrates.
ResPublica director Phillip Blond said: “As countless scandals demonstrate, virtue is distinctly absent from our banking institutions.
“Britain’s bankers lack a sense of ethos and the institutions they work for lack a clearly defined social purpose.”
“The bankers’ oath represents a remarkable opportunity to fulfil their proper moral and economic purpose, and finally place bankers on the road to absolution.”
Banks employ just under 440,000 staff, equivalent to around 1.4% of the UK workforce.
Part of ResPublica’s banker’s oath says: “I will do my utmost to behave in a manner that prioritises the needs of customers. It my first duty to provide an exemplary quality of service to my customers and to exhibit a duty of care above and beyond what is required by law.”
Another part of the oath adds: “I will confront profligacy and impropriety wherever I encounter it, for the conduct of bankers can have dramatic consequence for society.”
BBA executive director for financial policy and operations Paul Chisnall said: “Restoring trust and confidence is the banking industry’s number one priority. But meaningful cultural change in an industry as complex and diverse as banking takes time.”
He added that a wide-ranging banking oath “very well could be part of the answer”.
Last year, the Government-backed Parliamentary Commission on Banking Standards was one of the first to call for bankers to swear a good-service oath.
As part of an ongoing probe into Libor interest rate fixing, Lloyds Banking Group was fined £218 million by UK and US authorities.