Troubled Co-op bank insists ethics still key as it launches poll of nearly 5 million customers
PUBLISHED: 19:12 11 June 2014 | UPDATED: 13:07 12 June 2014
The troubled Co-operative Bank is launching a poll of nearly five million customers today as it updates its ethical policy.
It follows a crisis last year when it nearly collapsed and had to be rescued by investors including US hedge funds after a £1.5 billion hole was found in its balance sheet.
The wider Co-op group now has a stake of just 20% in the business, loosening the lender’s connection to the 150-year-old mutual organisation which previously owned it outright.
But the bank’s chief executive Niall Booker insists that its ethics continue to be central to its identity.
He said: “The Co-op is not like other banks. Our heritage, ethos and values are different.
“That is why it is so important to renew and refresh our values and ethics to ensure that the next chapter of the bank is true to its heritage and translated to today’s world.”
The poll of 4.7 million personal and business customers will seek views on the five elements of its current ethical framework: human rights, international development, animal welfare, economic and social development in Britain, and the environment.
Within this there will be new questions covering genetically modified food, data privacy and surveillance techniques.
The survey will also gauge opinion about three new areas: responsible banking, transparency and treating customers fairly.
Results will feed in to a new ethical policy to take effect from this autumn.
Mr Booker wrote in the Guardian earlier this week: “Our aim is not to exit any areas but to add to them, update them and make our ethics more relevant to our customers.”
The changes are partly aimed at making the rules more relevant at a time when it is moving away from loans to big companies to focus on small firms. Last summer it suspended new corporate lending indefinitely as it sought to repair its balance sheet.
In 1992, the Co-op became the first bank in the UK to have an ethical policy. Since launching it has seen £1.2 billion in loans turned down because they did not meet the criteria, the lender said. Over the period the policy has been reviewed four times.
Last November, the lender had values and ethics written into its constitution for the first time as it underwent its separation from the wider group.
It has also appointed Laura Carstensen, of the Equality and Human Rights Commission, to chair a values and ethics committee.
Mr Booker said: “I want as many of our customers as possible to take part in the poll so that we can be the first bank to publicly survey its customers about ethics in banking following the financial crisis.
“It is essential to the future of the bank and to helping rebuild trust in the banking sector.”
It comes after the wider group launched a nationwide consultation asking the public to help shape its future. Results have yet to be revealed.
The bank reported a loss of £1.3 billion for 2013.
A scathing review by Sir Christopher Kelly pinned the blame for its near-collapse on toxic loans inherited from its disastrous merger with the Britannia building society - and laid bare a “sorry story” of multiple management failures.