With the Prime Minister caving and establishing a royal commission into the alleged misconduct of banks and financial services, HR has the job of trying to reconcile leadership and frontline employees.
For anyone who works in HR in the banking sector, the past few years have been uncomfortable to say the least. A litany of scandals afflicting the industry has sucked away consumer confidence. But a problem for HR is that the response from those working inside has been deeply divided. Employees have generally been more for a formal government inquiry, while senior executives have been opposed.
This came to a head recently, when Prime Minister Malcolm Turnbull caved into pressure and announced that there would be a royal commission established to investigate standards of conduct – after spending the last year and a half saying there would be no such thing. The executives and chairs of the big four banks had also for some time being saying a royal commission was a bad idea.
But, in a joint statement that was emailed to Treasurer Scott Morrison, they too seem to have changed their minds, and called for a “properly constituted inquiry” into the financial services sector. “It is now in the national interest for the political uncertainty to end,” the email read.
Even so, their reluctance is still palpable, with the same statement reiterating their previous stance towards an inquiry: “Our banks have consistently argued the view that they are costly and unnecessary distractions at a time when the finance sector faces significant challenges and disruption from technology and growing global macroeconomic uncertainty.”
The statement came a day after a call from hundreds of thousands of ordinary bank employees insisting the sector get its house in order, through the mouthpiece of their union, the Finance Sector Union (FSU).
As unfair as it may be, those toiling away in retail banking are at the sharp end of customer discontent and, as customers themselves understand the frustrations on the frontline.
A bubbling conflict
Back in 2016, in response to community concerns about the banks, Turnbull called the bank bosses in for questioning in front of a Parliamentary committee. The FSU called it inadequate, saying that only a royal commission into banking would be able to properly examine the problems that were worrying consumers and employees.
Acting National Secretary at the time, Geoff Derrick said: “Calling bank chief executives to Canberra isn’t an adequate response to the problems of conflicted remuneration, sales targets, management culture, understaffing, offshoring, customer migration, branch closures, job security and a work culture that creates stress for bank staff.”
Current FSU National Secretary Julia Angrisano told the Sydney Morning Herald that they don’t doubt that senior banking executives are speaking truthfully when they say they want a more ethical, fair and transparent sector.
“But we are also realists; for decades, our union has seen ordinary bank workers held responsible for actions that can only arise from toxic or mercenary banking cultures – cultures that senior executives must bear responsibility for,” she said.
Aligning leadership with employees
So with banking employees having effectively won the day and banking leaders being forced down a road they are reluctant to travel, how will this play out?
“It’s an opportunity to reset the way things are done inside our banks – and HR has an opportunity to take a lead here” says Marcus Crow, co-founder at skill acquisition firm, 10,000 hours. “The royal commission will drag large amounts of resources into participating and responding to the investigation. It will prove to be an inflection point – painful in the present – but rebasing our ability to be candid in the workplace, to surface inappropriate conduct and hopefully, in time, history will judge it kindly,” he says.
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