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PRESS RELEASE

7 November 2011

ACFA Calls for Ethical Reform in City Financial Sector

Christian Financial Advisers told how ingrained "Ethics" at the heart of banking must be dramatically addressed; changing rules or taxation will ultimately have little effect

'Dr Rosamund Thomas told the annual conference of the “Association of Christian Financial Advisers” (ACFA) in her keynote address that there must be an ethical reform of the financial systems to restore honesty, integrity and fairness

Bonuses ‘inflammatory’ at time of financial hardship. Culture of greed must be stopped to prevent future financial crises.’

The Association of Christian Financial Advisers has criticised high bank bonuses for further widening the gap between the rich and the poor. And ACFA is calling for new ethical criteria and better ethical leadership within the financial system to prevent further financial crises.

'The whole world economy is put at risk if there is a widening gap between the rich and the poor and unethical behaviour in the financial industry,' Dr Rosamund Thomas told the annual conference of the Association of Christian Financial Advisers. More generally, massive FT-SE 100 executive remuneration increases in 2010 (43.5% directors to 66.5% chief executives on average) demonstrate either wilful arrogance or a disconnect with the lives of ordinary workers.

Dr Thomas, the Director of the Centre for Business and Public Sector Ethics in Cambridge, was the Conference keynote speaker.

She described the multi-billion pound bonuses still being awarded to UK financial workers as 'inflammatory’, when many citizens are experiencing financial hardship, unemployment and increasing costs.

'Is it any wonder that public demonstrations globally are taking place in the light of an increasing gap between rich and poor?' she added.

Dr Thomas said the banking crisis of 2007 had revealed a culture of greed, fraud and mismanagement. She criticised British banks HBOS, Lloyds TSB and the Royal Bank of Scotland for their then 'unethical behaviour and extreme risk-taking, with salaries, bonuses and pensions driven by greed.'

ACFA chairman Aidan Vaughan is calling for ethical reform of the financial system. ‘The proposed banking reforms are unlikely to lead to the ethical improvements that are so urgently needed,' he said. ‘It has to go far beyond being a ‘good citizen’ but making sure that banks and other institutions at the fulcrum of money transfers benefit all stakeholders over the long term. Financial products and structures need to have a beneficial purpose, rather than being an end in themselves. The City of London should be thought leaders in this field just as they have been in financial innovation’.

Chris Sheldon, interim Chief Executive of Kingdom Bank and an ACFA member, underlines the importance to the economy of a successful banking sector, especially when that has the resources to lend to community organisations.

'ACFA is calling for integrity and honesty in the financial system if it is to return to a foundation of trust, rather than greed. Ethical values must take centre stage in the financial world. Unless justice and fairness prevail, then the rot at the heart of the financial system will continue to spread.'

Dr Thomas warned: 'The current range of reforms will not prevent another financial crisis, unless behavioural reforms, based on improved ethical conduct are incorporated. As yet, the inclusion of ethical standards is not happening.'

ACFA is the UK network of Christian financial advisers and related professionals. It aims to be the voice of Christian financial advice and champions best practice in the UK. The ACFA website offers links to Christian financial advisers across the UK.

For more information please contact:

Andrew Boyd, ACFA press secretary, on 07919 311993, andrewboydconsultant@btinternet.com

ACFA chairman Aidan Vaughan, 020 7831 4711, aidan@mplltd.co.uk

Dr Rosamund Thomas: Centre for Business and Public Sector Ethics, 01954 710086, info@ethicscentre.org