The financial secretary to the Treasury has called for the banking industry to lead the changes in a reform of bankers’ remuneration policies in order to regain public trust and confidence.
Speaking at the British Bankers’ Association annual dinner, Mark Hoban MP said that although the coalition government has a role to play, banks need to demonstrate commitment by serving the economy rather than being seen as self-serving and act as the motor of future growth.
He added that the government will explore the costs and benefits of a financial activities tax on profits and remuneration. It will also ask the Financial Services Authority to examine further options in the forthcoming review of its remuneration code.
“A key way a regaining public trust will be by reforming the system of remuneration,” he said.
“We have the opportunity to send a clear message to the public that the banking system now operates in a way that is fair and stable and no longer rewards employees based on short-term performance while leaving investors and taxpayers exposed to long-term risks. It is better for the industry to lead these changes."
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