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Bank of England Governor says greater diversity at the Bank could have made it more able to protect the UK from financial crises.
Greater diversity at the Bank of England could better protect Britain from future financial crises, according to the Bank’s Governor.
In a speech yesterday on the need for diversity of thought and perspective, Andrew Bailey said: “Having a breadth of diverse perspectives allows us to act more quickly and decisively in a crisis.”
He added: “As a public institution, we need to represent the diversity of the country in what we look like, who we talk to and the impact of our decisions. But, just as importantly, it helps us achieve our objectives. Improved cognitive diversity helps make for better decision-making. The lack of such diversity has been highlighted as one important factor in the bank and regulatory failures of 2008.”
Bailey was speaking on the day that the Bank published an update of its Market Intelligence Charter and UK Money Markets Code which aims to embed diverse outreach into the Bank’s working practices and help make diversity within financial markets a core standard of best practice. Bailey said: “The Charter sets out our aims and ambitions of talking to a diverse range of contacts and affirms our commitment to open engagement, with an emphasis on challenge and diversity of thought. The updated Code, which the FCA have recently again recognised as an industry standard, puts the expectation to promote and develop a diverse team upfront, alongside other core principles of best practice, highlighting the benefits of accessing a wider range of skills and thinking.”
The Bank’s latest annual report showed the share of women in senior positions rose from 17% in 2013 to 32% in 2019-20, with a target of 35% by the end of 2020. Meanwhile, only 7% of senior roles are held by people from BAME backgrounds, compared to a 2022 target of 13%. The proportion of BAME workers in more junior roles has hit a target of 20%.
The Bank has also announced that Chief Operating Officer Jo Place will lead a review of its geographical footprint which has been commissioned by its Governors and Court of Directors.
The review will consider aspects such as the number of staff involved, recruitment models and the timescales for delivery.
The Bank’s current intention is to locate a new hub in Leeds and look to further expand the Bank’s presence around the UK. This will be subject to further review as work progresses.
The review will also take into account the experiences of remote working throughout the pandemic, with the Bank expecting to allow a more flexible model of working in the future to allow Bank employees greater flexibility about when, where and how they work.