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Regulatory references: the new rules of recruitment for the financial sector

In our article published in HR Zone, we consider the introduction of the new rules on regulatory references which come into force on 7 March 2017 and the practical steps that employers must take to comply with and implement the new regime.

Click here to read the full article.

Regulatory references: the new rules of recruitment for the financial sector

The Government’s Charter: Gender balance targets in the City

On 22 March 2016, the Government launched a new charter to link City bonuses to the appointment of senior women. The charter is in response to a review by Jayne-Anne Gahdia, CEO of Virgin Money, into the representation of women in senior managerial roles in the financial industry.

The Gadhia review found that, in the UK, financial services female representation was around 23% on boards, but only 14% on executive committees. Amongst other things, the review recommended that financial service firms connect part of the remuneration packages of their executive teams to gender balance targets.

The Government’s charter asks financial service companies to implement four actions:

  1. Have one member of the senior executive team who is responsible and accountable for gender diversity and inclusion.
  2. Set internal targets for gender diversity in senior management.
  3. Publish progress annually against these targets in reports on their websites.
  4. Aim to ensure the pay of the senior executive team is linked to delivery against these internal targets on gender diversity.

The recommended actions are voluntary. However, Virgin Money, Lloyds Banking Group, Barclays, HSBC, the Royal Bank of Scotland, Columbia Threadneedle and Capital Credit Union have already indicated that they will be pledging their commitment to improve gender diversity in their firms. This is already an impressive list and the Treasury will publish a list of the firms who have signed up to the charter in three months’ time.

However, the Treasury has indicated that if large sections of the industry do not engage with the recommendations, it may need to re-examine whether a more prescriptive approach is required.

The Government’s Charter: Gender balance targets in the City

Insight: UK financial institutions: Whistling while they work?

Financial service companies in the UK may soon face the prospect of remodelling their whistleblowing procedures and nominating whistleblowing champions.

The Public Interest Disclosure Act 1998 (PIDA) currently protects employees from suffering a detriment, or being dismissed, as a result of blowing the whistle in certain circumstances. Employees may receive compensation if they bring a successful claim in the Employment Tribunal in respect of such treatment. However, there is not currently any legal or regulatory duty on employers to have whistleblowing arrangements in place. The Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA)— the bodies charged with financial regulation in the UK—have published a joint consultation paper about formalising whistleblowing procedures in UK banks, building societies, credit unions with over £25 million of assets, PRA investment firms and insurers. This is anticipated to be approximately 1,500 firms in total.

Read the full article here.

Insight: UK financial institutions: Whistling while they work?