Thursday 21 September 2017

Bank of England to appoint conflicts officer after deputy governor embarrassment

Bank governor Mark Carney
Bank governor Mark Carney

Ben Woods

The Bank of England is to appoint an officer to pinpoint potential conflicts of interest, as it moved to shore up its governance procedures following the resignation of deputy governor Charlotte Hogg.

The central bank said it would introduce a conflicts officer and develop a central system for capturing and reviewing data on relationships and conflicts in the wake of a review by the Bank's non-executive directors.

It comes after officials were left red-faced in March when Ms Hogg resigned just two weeks after she took up the post for failing to declare that her brother works for Barclays.

Bank governor Mark Carney welcomed the review and said the findings would be implemented in full.

He said: "The Bank holds itself to the highest standards, which is why it is important to address any actual or perceived deficiencies in our approach to managing conflicts of interest.

"In addition to ensuring that we meet best practice, addressing the review's recommendations will give everyone who works at the Bank greater clarity on what is expected, and will help reassure all of those to whom we are accountable that we have an effective and robust approach to conflicts management."

A scathing verdict in a report by MPs on the Treasury Select Committee found Ms Hogg's "professional competence falls short" of the standards required for the role after the conflict of interest breach.

The omission saw her fall foul of the code of conduct rules she helped to draw up at the Bank.

Treasury veteran Sir Dave Ramsden was named as Ms Hogg's replacement at the end of last month, taking the role of deputy governor for markets and banking.

Sir Dave, who led the Treasury's work on whether the UK should join the euro at the turn of the century, will also join the Bank's rate-setting Monetary Policy Committee (MPC).

Bradley Fried, deputy chairman of the Bank's Court who led the review, said: "This has been a thorough process, involving Bank of England staff and input from Herbert Smith Freehills LLP and the National Audit Office.

"The priority has been to publish at the earliest possible opportunity a comprehensive review, aligned to independent best practice benchmarks."

The Bank, which is due to publish an updated code of conduct in the autumn, said it was working with the Treasury to improve conflict of interest checks around recruiting senior staff to the Court and policy committees.

It is understood a Bank official will take on the conflicts officer position as an additional responsibility.

The expectation is they will not be paid extra money for the role.

Press Association

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