The decision by the Board of The BFO to reintegrate the organisation into its spiritual home, The Ethics Centre, provides a wonderful opportunity to build on over three decades of work that began with the launch of the Centre in 1989.
The banking and finance industry has been an important area of focus since we convened our first roundtable with industry leaders in 1990. Indeed, the Commonwealth Bank was one of five organisations to subscribe foundation capital to get the Centre up and running. Westpac was the first corporate member of the Centre. Since then, we have worked with all of the major banks, most of the insurance industry and superannuation funds – and many smaller industry players – sometimes acting as a ‘sounding board’, sometimes as a service provider (facilitating mergers, measuring culture, etc.) and sometimes as a catalyst and enabler of better practices.
Indeed, it was through the work of an Ethics Centre Fellow, Clare Payne (then on secondment from Macquarie Group) that we commenced the process of engagement that led to the formation of The BFO. Clare had already been liaising with industry leaders – exploring a range of possible initiatives – when the Global Financial Crisis (GFC) struck. Australian banking and financial institutions were some of the least affected in the world. At the time, this was seen to be an endorsement of the Australian regulatory regime.
Given the later findings of the Hayne Royal Commission, it might seem odd that the Australian industry was then regarded so well. Yet, at that time, a number of our banks and financial institutions had already learned some very hard lessons; especially during the 1980s and early 1990s.
I still recall the famous Westpac ‘squashed tomato’ Annual Report. The cover showed a perfectly formed, bright red tomato accompanied by the words “Juicy Result”. Inside, the report depicted the splattered reality of “public resentment”. It was (and remains) an extraordinary example of radical transparency.
Of course, Westpac was not alone. Many (perhaps most) parts of the industry have had their own ‘squashed tomato’ moments.
By the time of the GFC, although the concept of ‘risk culture’ was yet to emerge with full force, the Australian industry had at least begun to realise that narrow forms of compliance could not be relied on as the sole lever for preventing risky conduct. However, the question remained … if you’re asking the Australian public to accept your view that regulation, alone, is not the answer, then …
“What do you stand for as an industry?” The answer was as brief as it was revealing. “Nothing.” The BFO was created to fill that void.
Most importantly, it was created for individuals wanting to affirm their commitment to something larger than a single company, to affirm the good they hoped to bring to society through their work.
That has always been the ‘genius’ behind The BFO. It’s not a program reserved for established leaders or for major institutions. It is not a program at all. Rather, it is a bond that establishes a fundamental equality between signatories. No one counts for more or less because of a job title, or experience, or renown. Every Signatory is equal in their capacity to make a profound difference and in their accountability, to the whole, for doing so.
So, what can The Ethics Centre add to this movement? Perhaps most importantly, we offer Signatories an opportunity to contribute to a larger purpose while retaining their distinctive identity. Beyond this, I think that the Centre will catalyse a new phase of original thinking about the purpose of banking and finance. In turn, this will hopefully inspire a new generation of emerging leaders to embrace The BFO and harness its power to shape a future in which every person working in financial services does so with a sense of pride and fulfilment. So begins the next chapter in the evolution of The BFO.