The Bankers’ Oath: Honesty, integrity, and ethics’

7^th August 2014

Following the launch of ResPublica’s Virtuous Banking report, Stephen Dunne, Chairman of The Banking Finance Oath and Managing Director of AMP Capital, discusses how Australia have developed an Oath to restore trust and improve standards in the banking and finance industry

Honesty, integrity, and ethics – would you feel comfortable using these words to describe the banking and finance industry?

In Australia, the answer would probably be ‘no’. Despite the fact that the Australian banking and finance industry had fared better than most following the Global Financial Crisis, it was evident that the dominant public response to the crisis seemed to be to abandon trust in many (if not all) of the industry’s members and to increase the level of regulation and surveillance.

There is no doubt that a formal system of regulation and surveillance is necessary however, sole reliance on compliance is not sufficient. An over-regulated industry can be expensive, at times inefficient and lacking innovation – ultimately becoming a costly burden on society. Importantly too, regulation, education and leadership alone do not address the ethical fabric of the industry.

A group of like-minded leaders in the Australian banking and finance industry in conjunction with St James Ethics Centre, decided to come together in order to explore the possibility of developing a new ethical foundation for the industry as a whole. Given the global scope and diversity within the industry, a credible initiative that transcended membership of any particular corporation or jurisdiction was required. It is this requirement that has led to the development of the Banking Finance Oath.

The Banking Finance Oath (BFO) is a set of professional obligations freely entered into by individuals who choose to be accountable to each other for upholding the oath. The model for the BFO was loosely based on two sets of commitments that the board deemed appropriate for the banking and finance sector. Firstly, the Hippocratic oath that binds (or used to bind) physicians personally, irrespective of where they worked was taken into consideration. This Hippocratic oath was then teamed with the ethical code that bound the early enlightenment scientists into a virtual ‘commonwealth’ that allowed them to work collaboratively on a common set of standards, despite being separated.

The establishment of such an initiative is clearly an ambitious goal and has emerged in response to a ‘felt need’ within the industry. By volunteering to take this Oath and be accountable to your peers, we hope to establish a foundation of trust in the industry, both internally and in terms of public perception. We aim to use the BFO as a tool to drive greater emphasis on individual accountability for decision-making across the industry and hopefully in due course, help shape the industry and its relationship with society.

It is heartening to see the number of people who have embraced the initiative after hearing about it for the first time, as well as the steady growth the movement continues to experience, within Australia and of late, abroad. The success of this movement comes down to the framework of inter-personal accountability as well as the supportive environment it creates.

The Oath prompts personal reflection about practices where good people find themselves doing bad things simply because, “that’s the way it has always been done” or because “everybody does it that way”.

Good regulation will only be truly effective when a common ethical foundation, such as that provided by the Oath, is widely adopted by individuals (not companies) working across the entire sector. Our ideal is of an industry where Signatories to the Oath can look beyond their corporation and find like-minded ‘kindred spirits’.

Only then will the industry look beyond mere compliance (important as it is) and establish a foundation of trust, based on personal conviction, upon which the community can once again rely.

The Oath

Trust is the foundation of my profession

I will serve all interests in good faith

I will compete with honour

I will pursue my ends with ethical restraint

I will create a sustainable future

I will help create a more just society

I will speak out against wrongdoing and support others who do the same

I will accept responsibility for my actions

My word is my bond

Please visit the BFO website to watch a short film discussing the Oath and read recent news coverage responding to the BFO’s statement in support of whistleblowers.