The most significant part of the Co-operative Bank’s survey on ethics and values has been the clear statement that it is not aiming to exit any existing ethical policy areas.
This is something that supporters of the Save Our Bank campaign, which I am involved in running, have been calling for in hundreds of emails and tweets to the Bank over the past few months, and we’re pleased the Bank has listened. We’ll be watching the final outcome carefully to make sure this is upheld.
While a lot has gone wrong at the Bank over the past 18 months, this has been despite the Bank’s Ethical Policy and not because of it, and the first priority of our campaign has been to make sure the bank keeps this policy strong under the new owners. However the stark conclusion of the Kelly Review, that management “collectively failed to ensure that the Bank consistently lived up to its ethical principles,” shows how urgently it needs to make sure ethics run through all aspects of the business, and not just who it finances.
On this score, we’re pleased to see the Bank asking questions about supporting initiatives such as the Living Wage, and about being responsible on executive pay. Our supporters lobbied hard for executive pay and bonuses to be treated as an ethical issue, so again this shows they have listened. We need stronger commitments here though – other organisations like John Lewis have taken the lead by applying pay ratios between the highest paid staff and the average, and giving the same percentage bonus to all staff based on profits.
The Co-operative Bank needs to aim for leadership on this, but instead Niall Booker is on track to receive four times the salary of his predecessor. We’ve called on him to show the Bank is different by rejecting his bonus.
On the downside, some of our supporters have questioned a methodology that forces customers to play off one ethical issue against another; for example, setting combatting poverty in the UK against development overseas. And asking customers whether the Bank should avoid “excessively risky lending” seems superfluous to say the least.
In addition, there’s no mention of external auditing of the Ethical Policy, which has always happened and which the Bank needs to continue under its new owners. Without strong enforcement the policy is meaningless. We need to press further on these issues.
Given the Bank’s stated aim not to exit any existing policy areas, we’re surprised that a couple of important policy statements are entirely missing from this survey – for example, on refusing to support businesses which fail to uphold basic human rights, or which manufacture cluster bombs. It seems unlikely that the Bank is about to dive deep into financing human rights abusers, but we have asked the Bank for an explanation of this omission.
But there’s one big topic that isn’t mentioned in the survey – ownership. The Co-operative Group now only owns 20% of the Bank, with the rest owned by private investors and hedge funds (and the Bank is not being transparent about who owns how much). The second priority of the Save Our Bank Campaign is to fight for a return to mutual ownership, and we’re under no illusions about what an uphill battle this will be. But there are concrete steps the Bank could take, like setting out a plan to become a real co-operative again, and giving customers and staff the opportunity to buy shares in the Bank as part of a growing co-operative shareholding.
Overall, this consultation shows that the Bank has been responsive to the effective union of over 10,000 Co-operative Bank customers that the Save Our Bank Campaign has built up. Crucially it promises more ethics, not less. However it doesn’t yet promise us a co-operative bank.
• The Co-operative Bank’s values and ethics poll closes on Monday 30 June, to take part visit: www.co-operativebank.co.uk/poll. For more information on, or to join, the Save Our Bank campaign, see: www.saveourbank.coop/join