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New campaign pushes code of conduct for financial services

Shane Mullins is hoping that his Question of Trust campaign can build confidence in the wake of decades of scandals.


by Michelle McGagh on Jul 10, 2012 at 15:01

Getting consumers to trust financial services is an uphill struggle following decades of mis-selling scandals, not to mention Barclays' fixing of inter-bank lending rates.

But one group of financial services companies is hoping to do just that with a new campaign: Question of Trust.

The initiative was started by Shane Mullins, managing director of independent financial advice firm Fiscal Engineers, and it aims to get large financial institutions to commit to developing and operating with a culture that promotes consumer trust.

A question of trust

The Question of Trust campaign intends to unify financial services companies, from small broker firms to life and insurance giants, and sign up to a code or level of standards which puts the consumer at the heart of what they do.

This includes the development of a baseline measure of trust, called the Money Trust Index, which was developed by the Financial Services Research Forum at the University of Nottingham.

The campaign will then make ongoing recommendations on how trust can be improved across the industry.

Mullins said: 'If we are to change we need to build a culture of doing the right thing within the industry.'

A call for change

Mullins added that financial services companies have been driven by profit targets, shareholder demands and bonuses rather than the best outcome for consumers.

'For far too long the industry has held a mask up to itself instead of a mirror. Certain executives have been accused of managing their share options rather than their businesses, and some political leaders of managing their reputations rather than the real interests of the country,' he said.

'We need root-cause action right across the industry, coupled with strength of leadership and a commitment to take the long view to change things for the better.'

The campaign is hoping to tackle the vulnerability consumers feel when purchasing financial products, which are often difficult to understand. The complex nature of financial products breeds the need for more trust, and without trust consumers will be unwilling to engage with their finances.

Consequently if consumers do not trust and engage with their finances they will be unprepared for financial shocks they may experience, such as illness or redundancy. It could also mean they are unprepared for retirement.

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4 comments so far. Why not have your say?

Greg Kingston

Jul 10, 2012 at 16:09

This is an excellent campaign, and one which I wholeheartedly support.

Last week I blogged on here about my challenge to go a week living off the State Pension, and I was shocked by the level of cynicism, lack of trust and occasional downright aggression demonstrated by someone that has 'revealed' themselves as working in financial services. These emotions can only have come about by years of a feeling of a lack of trust, and that absolutely has to change.

There are fantastic forces within financial services, genuinely working towards better service and outcomes for consumers, but without trust they will come to nothing, and by doing nothing consumer risk leaving themselves is worse positions.

Very well done to all involved for starting this.


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Phil Young

Jul 10, 2012 at 19:03

Well said Shane

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William Phillips

Jul 11, 2012 at 11:58

The best way to remoralise the business is to remutualise it.

But in Thatcher's time, the only way forward post-Big Bang was thought to be floating on the stock exchange and henceforth being 'driven' by 'targets'-- so that every set of quarterly or half-yearly results would look better, the share price would keep climbing and be negotiable currency for takeovers, and every employee but the cleaning lady (who was sacked and replaced by an illegal immigrant) would become a salesman first and foremost.

Building societies were launched as philanthropic, self-help institutions, and the old regional clearing banks usually had much the same ethos. As partnerships or private companies, they were not under the lash of 'incentivised' short-term performance, the fount of all evils from mis-selling to lying about LIBOR.

Now we have reached the reductio ad absurdum that is nanosecond share trading, can we start moving back towards a mixed economy in financial business which will make a big and growing space for non-profits? Perhaps the rise of credit unions and P2P lending are straws in the wind. After all, if we can have the lowest interest rates for 300 years, why shouldn't the City's clock be moved back a few years before 1986?

One of our few world-class industries is television, where the combination of the BBC and a flock of private broadcasters has produced better results than either a public monopoly or a Murdochian free-for-all. Likewise we need more Co-ops in banking and Nationwides in mortgage lending. And whatever happened to the Man from the Pru? The collapse of insurance offices into the death grip of the stock market has been a disaster for them as well as their mis-sold customers-- look at their ratings and yields. They are the next big catastrophe waiting to happen after banking.

But simply exhorting the piranhas to become vegetarians, as codes of conduct do, is futile. Change the environment (by the brute force of state expropriation and regulation if need be) if you want a less vicious fish to evolve.

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Jul 14, 2012 at 15:15

The Man from the Pru is reborn in Asia where they have many thousand of Agents operating. I dont know if they are still driven by profit, targets, share holder demands and bonuses but I would be surprised if they denied it.

I received a letter from the Pru back in January of this Year introducing their new financial advice service, Prudential Financial Planning. It appears there is a gap in the market back in the Uk now that all the other home service providers are now obsolete, the CO OP was the last to go. So the new Man from the Pru is back in business. I just hope they keep their word and get in touch as I am still waiting some seven months later. I just hope it's not a case of paying them peanuts, as we all know what you get if that's the case.

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