BBA chief executive Angela Knight said the Treasury Committeeâs report published today was a helpful contribution to the debate on the future of the UKâs financial system.
âThe MPs have looked at the twin issues of pay and probity in the banks and have reached some challenging conclusions. The responsibilities of shareholders, executives, board members and regulators are all considered and the clear message is that in retrospect some things should have been spotted sooner and actions taken. This is easier to observe in hindsight. Many issues, such as pay structures, have now moved on: the regulator is now scrutinising pay as part of its supervision of banks.
âThe report helpfully distinguishes between the pay structures for the vast majority of high street bank staff and the very different approaches of some of the big investment banks. There is a clear need to get sensible structures in place which reward long-term performance, and to ensure that what we do in the UK is coordinated globally.
âIt is essential to get the rating agencies right, as so much reliance is given to what they say. Accounting standards are just as important: the report is absolutely right to note that the European exemptions to the global accounting roles have caused enormous confusion when what is needed is clarity.
âThe UK has a commendably open culture in scrutinising failings and acknowledging wrongs. But other countries are watching us, and none uses quite such pejorative language in its scrutiny of financial institutions. Of course we need to put things right in the UK, but we also need to remember that what we say and do is being watched keenly by contenders for our business. Our financial services sector is a significant employer which pays significant taxes: we do not want to lose it to a competitor.â