Wednesday, 8 May 2019

Questions (173)

Clare Daly


173. Deputy Clare Daly asked the Minister for Finance the way in which he plans to monitor the recently announced intentions of a bank (details supplied) to promote a sustainable banking future by incorporating social values into its business model; and the way in which he will hold the bank to account for measurable concrete actions to empower small business and personal banking in local communities nationally. [19547/19]

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Written answers (Question to Finance)

As the Deputy will be aware, AIB is an independent company with listings on the Irish and London Stock Exchanges. The decisions around lending operations are the sole responsibility of the board and management of AIB which must be run on an independent and commercial basis. The bank's independence is protected by a Relationship Framework which is a legally binding document that cannot be changed unilaterally. This framework which is publicly available, was insisted upon by the European Commission to protect competition in the Irish market. The AIB Relationship Framework can be found at the following link.

Saying this I have spoken at length about my objective in legislating for expanded Central Bank powers. We want to cultivate a sustainable financial services industry with rewards reaped over the long-term for customers, staff, and shareholders and where consideration of the impact on individuals, the economy and society as a whole is firmly embedded in organisational culture. Furthermore the recently established Irish Banking Culture Board is an independently led entity created to ensure that the industry is focused on the best interests of the customer and leads to a sustainable banking industry that promotes the highest standards of behaviour and professionalism.

My officials contacted AIB and received the following response:

"AIB is working to rebuild its social licence to operate with all its stakeholders. As previously outlined by the Bank’s CEO, three critical factors underpin the Bank’s approach:

- The primacy of the customer (including enhanced openness in how the Bank engages with all its stakeholders).

- Accountability (supporting the CBI’s introduction of a Senior Executive accountability regime, underpinned by legislation).

- Sustainability (including decarbonisation of the economy; supporting renewable energy development; economic support for communities by maintaining a strong branch network as well as providing best-in-class digital access to products; supporting organisations with strong community links – sporting and cultural – and staff involvement in the fabric of local communities, including bank-backed volunteerism.

Under EU legislation (European Union, disclosure of non-financial and diversity information by certain large undertakings and Groups, Regulations 2017), AIB is required to publicly report on the approach, management and progress of the above matters as part of its annual Non-financial disclosures statements.

This is in addition to the voluntary annual AIB Group plc Sustainability Report that the Bank publishes which is independently assured by Deloitte and which adheres to the Global Reporting Index (GRI) – an internationally recognised standard."