Can you imagine being a bank CEO today? Wouldn’t you be wishing you were leading the bank 10 years ago before the global financial crisis when you could do whatever you wanted without too much fuss?
Fast forward to 2017. Bank CEOs are under intense scrutiny, but still pushing the banks’ profit-driven agenda in the face of scandal after scandal and community anger.
Take, for example, the Commonwealth Bank (CBA) money laundering issue of a few weeks ago. CBA allegedly broke anti-money laundering rules 53,000 times, yet its CEO Ian Narev gets to stay on until July next year, with the CBA chairperson stating they had “full confidence in Ian as CEO”.
Now, imagine ifa bank teller had breached anti-money laundering rules. Do we think this person would be given another year to work? They would most likely have been disciplined, sacked or worse. They would have been put on the Conduct Background Check register, the “bad apples” register shared between banks that can stop bank employees from working in the finance industry for a long time.
The recent Four Corners report “Betting on the house: Australia's real estate obsession driving us to the brink” has not helped the bank bosses either. Four Corners found that for every $1 earned, on average, Australians have nearly $2 of debt, giving us the second highest level of household debt in the world. The program went on to investigate the lending practices that have driven the boom in residential lending, with a focus on the role the banks played in driving this debt. This would have been painful viewing for any bank CEO.
It has been a year now since the Australian Bankers Association (ABA) launched its review into the banking industry, which included meetings with bank workers and the Finance Sector Union (FSU). While it was useful to highlight the stories of ordinary bank workers and their daily struggles working for the banks, it also produced mechanisms for scapegoating bank workers, such as the “bad apples” register, rather than focusing on the root cause of the problem — the drive to meet sales targets at all costs.
Bank workers and the FSU are well aware of the problems in the banking industry, but it will need more than a review by the ABA or a tightening of regulatory controls to deal with this. A royal commission is needed to investigate not only the CEOs and bank executives, but also the extended leadership team including the general managers who wield significant power over bank workers.
It is interesting to note that research into corporate sales culture shows that targets set and enforced by management are not as effective as allowing the staff to focus on servicing the customer independent of sales. When the product being sold is a loan or a mortgage, there is even more reason for sales targets to be dropped in favour of customer service, independent of the monetary outcome.
Unfortunately, in the market-driven society we live in, a royal commission into banking will not be enough to make the fundamental changes that are needed. Bank services are essential community services and they should not be profit generating at all. That is why Green Left Weekly supports the campaign to nationalise the banks and bring them under community control. But we need your help.
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