Our Work Programme over the past year has focussed primarily on initiatives and activities which were drawn from topics raised through the two pieces of research we commissioned prior to our establishment in October 2018. The findings of these surveys were the baseline of what the perceptions were of banking culture in Ireland at that time. In addition, the activities in our work programme have been shaped by the issues arising for bank customers and staff as a result of the Covid-19 pandemic.
In Spring of 2021 we commissioned two further pieces of research to provide us with an up-to-date view of banking culture in Ireland – these surveys and their findings will be discussed later in this report.
Financial awareness has been identified in IBCB research as a concern for many consumers and business owners. Improving financial awareness as early as possible is a key enabler in preventing knowledge gaps at future stages when key financial decisions are being made. Stakeholder feedback has highlighted the perception that technology changes, complexity of modern financial processes, and a lack of access to financial advice can adversely impact financial decisions and financial outcomes for many customer cohorts.
In light of the impact of Covid-19 on consumers and businesses, our financial awareness activities in the period focussed on activities and engagements to raise awareness and support consumers, in particular in areas such as payment breaks, and the range of alternative options available following payment breaks and specific initiatives to raise awareness for SMEs and Farmers. Our activities also included initiatives for customers in a vulnerable position and bereaved customers. Through this work, we engaged with member banks, the Banking and Payments Federation Ireland (BPFI) and organisations such as the Money Advice and Budgeting Service (MABS) and the Society of St. Vincent De Paul.
During the course of the last year, we have also contributed to a number of consultations on aspects of financial literacy, including:
- Supporting the Competition and Consumer Protection Commission (CCPC) in their response to the National Council for Curriculum and Assessment consultation on the Draft Primary Curriculum Framework, highlighting the importance of financial literacy as a life skill for young people;
- Submitting a response to the SOLAS Adult Literacy, Numeracy and Digital Literacy Strategy, highlighting the importance of financial literacy for adults.
Financial Awareness for SMEs & Farmers
Covid-19 has impacted all aspects of Irish society and the economy and in particular, caused significant challenges for many SMEs. The IBCB consulted with key SME stakeholders in the initial months of the crisis and heard feedback that businesses found it difficult to navigate the range of supports available and information required to support applications was not always readily available. We raised these issues with our member banks and welcomed the significant effort made by them to put in place a range of support options for customers, including payment breaks and ongoing supports.
We ran a workshop in July 2020 with representatives from our member banks, the Small Firms Association, the Strategic Banking Corporation of Ireland, the Banking and Payments Federation Ireland, and the Department of Business Enterprise and Innovation to discuss the challenges facing small business and to identify actions to support businesses. Arising from this workshop, the IBCB created our ‘Support, Share, Signpost’ initiative which looks to raise financial awareness for SMEs and Farmers through sharing and signposting relevant key information. As part of this initiative we:
Published a Signposting Guide, providing links to key financial supports in September 2020 (this guide has since been updated).
Between October 2020 and January 2021, we hosted a series of webinars aiming to helping SMEs and Farmers to improve knowledge when making financial decisions and to improve overall communication between both customers and banks. These covered the following topics:
SBCI Credit Guarantee Scheme
Microfinance and Social Finance
Applying for a loan from a bank
Lending for farming businesses
Customers in a Vulnerable Position
Financial vulnerability can occur at any time, it can be transient or permanent and many bank customers can find themselves in a vulnerable position for a range of reasons:
- A change in personal circumstances; bereavement, divorce or separation, the breakdown of family relationships or supports
- Issues with physical and mental health and wellbeing, including cognitive impairments, the diagnosis or onset of a serious or life-altering illness
- A disability, which requires additional or alternative supports
- Personal financial difficulties, including arrears and mounting debt
- Marginalised groups, who may find it difficult to access financial services.
In our external engagement, and through our research, we have heard from customers, stakeholders, and members of the public that banks should demonstrate more support for customers in a vulnerable position. Our priorities in the past year have been focussed on initiatives aimed at raising financial awareness for such customers and undertaking more detailed research projects. This research identified specific groups of customers who may be in a vulnerable position and in need of particular supports from their banks.
Through our work with member banks in the area of bereavement, we became aware of the work of Embrace Farm, a charitable organisation, who provides support to farming families who experience loss or life-changing injuries. The IBCB supported the publication of an important Embrace Farm supplement in the Irish Farmers Journal in June 2020. IBCB articles in the supplement focussed on raising awareness of the range of services and supports provided by IBCB member banks to farming customers in the event of a bereavement or life-changing injuries. The articles also covered the importance of preparing financial affairs for individuals, and the supports available for farm businesses in member banks. This supplement also included an opinion piece by Martin Stapleton, IBCB Board Member and Treasurer of the Irish Farmers’ Association (IFA) on the importance of banks treating all customers fairly and equitably, especially those who are in a vulnerable position.
During 2020, we contributed to consultations related to aspects of supports for customers in a vulnerable position. In May 2020, we responded to the Law Reform Commission’s Issues Paper on ‘A Regulatory Framework for Adult Safeguarding’. The IBCB response focused on financial abuse which impacts on bank customers, bank staff, and institutions. The categories of financial abuse raised in the issues paper include thefts and scams, financial victimisation, coercion, signs of possible financial exploitation, and money management difficulties. These are issues which are also of concern to the banking industry, and all IBCB member banks have existing services in place to protect and support customers who may experience financial abuse.
We continue to liaise closely with Safeguarding Ireland, through our role on the National Safeguarding Advisory Committee and State Payments Group. We have also engaged with MABS, the Society of St. Vincent De Paul, the Open Doors Initiative, and the European Consumer Debt Network.
In 2019 we launched the Common Commitment of Care with Member Banks, which provides for improved services for customers (and their families) who have experienced a bereavement. Following one full year in operation, we undertook an assessment of the impact of the Common Commitment of Care. The assessment included consulting with important stakeholders such as MABS, The Irish Hospice Foundation and the Coroner’s Court, and qualitative feedback received indicates that the Common Commitment of Care has made a positive difference in the period.
We continue to work with key stakeholders and customer advocates in this space, including the Irish Hospice Foundation and the Coroner’s Court. The Dublin District Coroner’s Court has published the Common Commitment of Care on their new website, making the information easily available for those most in need of assistance. We continue to liaise with the Coroner’s Court in relation to additional paperwork which may be placed on a statutory footing and streamline the process for customers further.
Transparent and Respectful Communications
Stakeholders have highlighted to us that there is a need for the sector to communicate with all customers – both profitable and less so, (particularly for customers in arrears or who may be in a vulnerable position), with greater respect and transparency. This is an ongoing area of focus for the IBCB and during this last year, our member banks came together to consider how to address this need. Member banks are working with the IBCB to specifically look at how they communicate with customers in letters, looking to enhance customer letters to make them more personal, to ensure they are written in plain English and to explain necessary technical terms. Our member banks are working through their plans internally to determine how they can implement these changes. These changes can be applied to new letters without many difficulties. It is more complex to update pre-existing letters or templates, as many of these are generated by a number of IT systems at a particular point in a customer’s journey. This requires updates to impacted IT systems, which will take some time to address. We will be monitoring progress in this regard on an ongoing basis and will continue to work with our member banks and stakeholders to identify other initiatives to improve communications with customers.
Citizenship & Society
A key finding in our original 2019 Public and Stakeholder Consultation Report was a sense from respondents that banks have a critical role to play in supporting communities and society as a whole and that the sector did not always fulfil this role well. This was particularly felt in rural Ireland and by customers who may be in a vulnerable position.
IBCB member banks recognise their unique role in society and each of our five member banks has established programmes focussing on how best to play this role and contribute to local communities and wider society in which they operate. Given the importance of this issue to the IBCB’s purpose, we established Citizenship and Society as our 3rd core pillar of activity during the year under review.
In mid-2020 we commissioned independent research through Gibney Communications to better understand the views and banking needs of specific cohorts in society, to inform our next steps in contributing to delivering positive banking change for communities and societies in Ireland.
The research project aimed to gather the views of bank branch staff and customers based in rural communities, key stakeholders and advocacy groups representing those in rural/ farming communities, those living with disabilities, SMEs, those in vulnerable positions and marginalised groups, through qualitative interviews, focus groups and some limited desk research.
The research was conducted between June and September 2020 and as a result the impact of the Covid-19 pandemic on individuals, businesses and communities is very evident in the findings. Several of the findings are similar to those themes identified in the IBCB 2019 Public and Stakeholder Consultation report.
The IBCB working group met to review the findings and identify priority actions in January 2021. The agreed key areas of focus for 2021 are:
- Customers living with a disability: specifically, those with cognitive difficulties in the first phase of the project, with the aim of improving awareness and accessibility.
- Customers for whom English is not their first language, whereby it can be difficult to ascertain customers’ awareness of financial products, particularly when making major financial decisions.
- Access to the basic bank account. This is seen as an enabler for those in financial difficulty as well as marginalised groups who may experience financial exclusion.
Our activities on this pillar in the past year have focused on the key cultural area of ethics and behaviour.
Ethics - DECiDE
Positive cultural change is founded on ethical behaviour. Demonstrating ethical decision-making consistently is challenging and is not unique to the banking industry. Feedback from staff in our member banks and other stakeholders including customers, highlighted the challenges involved in linking an organisation’s stated ethical values and behavioural requirements with the day to day decisions which staff across banks make on an ongoing basis.
Prompted by this feedback the IBCB decided to develop a practical decision-making framework aimed at staff at all levels in banks, from the top down.
Over the summer months of 2020, the IBCB held a series of ‘co-create’ sessions attended by 120 staff from our member banks, the IBCB Board and Working Group members, IOB (Institute of Banking), the Financial Services and Pensions Ombudsman and journalists, with the goal of developing a practical ethical decision-making framework based on a series of hypothetical ethical dilemmas. The purpose of those sessions was to obtain feedback, views and input on how ethics and decision making can be improved, what aids would work well and those that do not. Regardless of the type of dilemma used to prompt discussion – common ‘steps’ emerged.
Founded on established academics – with input from IBCB Deputy Chair Professor Blanaid Clarke and IOB, the purpose of DECiDE is to act as a practical guide and tool for bank staff, regardless of level, when making difficult decisions.
DECiDE is intended is to assist with the decision-making process by prompting staff to consider various elements which will enable them as the decision-maker to be able to stand over the decision they took at a point in time, even if it transpires in due course that the decision was not optimum. Like all businesses, bank staff are frequently required to make commercial decisions which will not always be popular, the challenge is to ensure that these decisions are taken fairly and transparently, with appropriate consideration of their impacts.
The framework prompts staff to consider a range of issues such as the impact of Group dynamics, personal bias, the importance of diversity & inclusion, the need to consider the potential risks associated with short-termism vs more long-term and sustainability considerations etc.
The final Framework was launched by the IBCB at a virtual event on 29th September 2020 and included an opening address from the IBCB Patron, Dr. Martin McAleese, an interactive session with Prof. Frank Flynn, the Paul E. Holden Professor of Organisational Behaviour at the Stanford Graduate School of Business, California and a panel discussion led by Prof. Blanaid Clarke. The launch event was attended by member bank staff, IBCB Board members; and a small number of attendees from external organisations who participated in the co-create sessions e.g., the Financial Service and Pensions Ombudsman and IOB.
Although broader embedding is still required, early indications from the results of our recent Staff Survey shows that DECiDE has made a positive impact, where staff are aware of and have used the framework. The IBCB will continue to work with our member Banks throughout the reminder of 2021 to further enhance the use of DECiDE and other internal decision-making supports.
The DECiDE decision-making framework is available in the Work Programme section of our website, under the Ethics and Behaviour tab.
Introducing the IBCB Launch of DECiDE Ethical Decision Making Framework
Dr. Martin McAleese
Prof. Francis Flynn
Stanford Graduate School of Business
Ethics - Artificial Intelligence (AI)
AI is being increasingly used throughout numerous industries, with banking being no exception. The challenge for all industries and in particular for banking, is that the use of AI in making credit and other decisioning for customers (or staff), is that this is done in a transparent manner resulting in fair outcomes.
The IBCB began focussing on this topic in 2021 as part of our work on ethics. We intend to run a dedicated roundtable on the topic in late 2021 and to develop some good practice principles for the use of AI in banking.