Mr. Justice John Hedigan:

I thank members for the invitation to present information on the Irish Banking Culture Board. I am accompanied by my acting chief executive officer, CEO, Ms Marion Kelly. I am happy to answer any and all questions the members of the committee might have. Ms Kelly and I have been working closely on this project and she will intervene wherever appropriate. Our aim is to ensure that questions are answered fully and accurately.

The Irish Banking Culture Board was established to regain public trust in banking. The only way banks can regain this trust is to earn it. Rebuilding the confidence of wider society in the industry will require time, patience, courage and commitment. I believe the board can play a key role in this process, through our own activities and through supporting and partnering with other relevant organisations. I view the establishment of the board as a positive development and an opportunity not to be missed. It is notable that 85% of the public and stakeholders who contributed to our public consultation exercise supported the establishment of the board.

The board is a unique body. Nothing like it has ever been established in Ireland previously. The board is comprises individuals with very different perspectives and backgrounds. All of them are stakeholders in the banking sector who have, for the first time, agreed to work together to improve banking culture. We have created a structure that represents the best means to contribute to real and authenticate change in a way that delivers for the citizens of our country. The fact that the banks are represented on the board, but in a minority, represents, to my mind, the best of both worlds. The non-bank majority, who are representative of a cross-section of society, will ensure that the voice and perspectives of the public will be heard. I believe that the changes necessary in banking culture have a far greater chance of being delivered because of, and not in spite of, the five member banks having representatives on the board.

I am not of the banking world, so how did I come to be the chair of the Irish Banking Culture Board? I read an advertisement in the newspaper, almost exactly one year ago. It stated that the five retail banks in Ireland had resolved to establish such a board to act as a transformative influence on culture within the banking sector, focused on earning the public's trust. It sounded to me like a very good idea and one not before its time. I replied to the advertisement. My appointment was entirely independent of the banks. It was conducted by way of an open competition. A selection panel was chaired by Dame Colette Bowe, the then chair of the United Kingdom Banking Standards Board. She was joined by Sir Callum McCarthy, the former head of the Financial Services Authority, FSA, in the UK and our own Dr. Martin McAleese.

I was appointed and commenced in the role of chair in January 2019. My first task was to select and appoint the members of the board. This selection process was, again, entirely independent. The criteria, in my mind, as I was selecting and appointing the board included ensuring that its membership would reflect the feedback received during the extensive public and stakeholder consultations, while still remaining at a manageable size. I was clear at the outset that each of the five founding banks had to be represented on the board by the most senior bankers. Why did I take that view? It was because the banks own the problem and they must own the solution. I am convinced that it is through vigorous, open dialogue and concerted action between these senior bankers and the non-bankers of the board that true, lasting and meaningful change will occur.

The composition of the board was announced at our launch on 15 April 2019.

It comprises 14 members, and committee members have had biographies of these people circulated to them beforehand. Along with the five senior bankers, there are seven non-banking members, who represent a wide range of stakeholders in the banking sector. They reflect what we heard during the public consultation process. They are as follows, in alphabetical order: Ms Angela Black, chief executive of the Citizens Information Board; Professor Blanaid Clarke, a leading authority on corporate ethics from Trinity College Dublin; Mr. Padraic Kissane of Padraic Kissane Financial Services; Mr. Gareth Murphy, head of industrial relations at the Financial Services Union; Mr. Philip O’Leary, managing partner at FitzGerald Legal & Advisory, chair of the Legal Aid Board and a lifelong advocate for consumer protection; Ms Sue O’Neill, chair of the Small Firms Association and board member of Microfinance Ireland and; Mr. Martin Stapleton, chair of the national farm business committee of the Irish Farmer’s Association. Mr. Stapleton is a dairy farmer from Limerick. The five senior bank representatives on the board represent a range of different skill sets. I asked for that and I got it. This includes a chief executive officer, a chief risk officer, a chief operations officer with IT and artificial intelligence expertise, a head of human resources and a head of consumer banking.

I refer to what we intend to do and why. From the outset, we have been conscious that it was critical to ask for and, listen to, the views of societal stakeholders, including banking staff, and bank customers on current banking culture and how the Irish Banking Culture Board can work to change this for the better. During our establishment phase, we conducted the extensive public and stakeholder consultation I have referred to. We received 747 submissions from the public via an online survey, and we commissioned a survey of more than 25,000 bank staff. We conducted 38 face-to-face interviews with individuals and organisations from right across society, including consumer organisations, small and large business, farmers, charities, youth groups, students, trade unions, rural interests, older customer groups, media, politicians and regulators. Some of committee members contributed to these proceedings and we thank them for that.

Our objective in determining what the board should first focus on was to reflect the concerns and suggestions we heard from the public, stakeholders and bank staff. We promised to address these concerns and that is what we are doing. Our work programme up to April 2020 comprises nine key themes, each of which has been identified from the findings of our public consultation. These themes are customers in a vulnerable position; services to bereaved customers; respectful and transparent communications; financial education and awareness; small medium enterprises, SMEs, including farmers; support for community and society; speaking up; embedding ethics and behaviour and; staff resilience and pressures.

During our work, we will partner as appropriate with the expertise in our member banks, with other relevant industry bodies such as the Banking and Payments Federation Ireland, BPFI, and the Institute of Bankers, as well as with other relevant bodies, to achieve our aims as efficiently and transparently as possible. However, we will always be protective of our independence and our overall goal of being a trusted, independent voice and a transformative influence on banking culture in Ireland. We will call out poor conduct when we find it and we will acknowledge good things when we can identify them. The chief executives and boards of the five founding-member banks of the Irish Banking Culture Board have clearly and repeatedly committed to me their full support for the board and its activities. The leadership of the banks recognises that this board is independent. We do not speak for the banks. We speak for the stakeholders of the industry. We see ourselves as a critical friend to the industry in many ways. We will promote an environment in which ethical behaviour lies at the heart of banking, values are restored, and a reputation for competence is rediscovered. We will hold the banks to account on their progress.

I accept the scepticism that exists around this endeavour. I am also a sceptic. It would be difficult to spend 42 years in the practice of the law without developing a healthy degree of scepticism. I have encountered a lot of bad places and bad people in my time as a judge and barrister in Ireland and as a judge at the European Court of Human Rights in Strasbourg. However, I have never lost my faith in human nature.

I am convinced that the vast majority of Irish men and women who work in the banking industry are decent, honest, honourable people who wish to serve their customers and their country well, to be an example to their families and friends and to feel proud of the work they do as guardians of a great national interest. Our task is to help and empower them to regain public trust in the banks by pursuing the highest ethical standards and levels of competence and by ensuring the fair and humane treatment of customers.

This is just the beginning. A long road lies ahead but I believe that we have made a good start. Identifying and changing culture is difficult for us and society. We must dare to believe that we can do this. Irish society and culture have changed dramatically over the years and bank culture must also change. People today demand better of everything, including their banks. We see ourselves as being part of this change in the banks, change that is not before time. Embedding ethical behaviour in banking culture is an ideal whose day has come in Ireland and around the globe. We dare to believe that we can do this. We can and we will.

Finally, should we be invited to return to this committee next year to update it on our activities, we would be delighted to do so to answer members' questions regarding our progress. I again thank the committee for the opportunity to present the IBCB to the committee this afternoon. We are very happy to take its questions.