News

UNI General Secretary Philip Jennings has laid down the challenge to the Financial Stability Board to create a healthy financial system that serves society and communities instead of share prices.

Speaking at UNI Finance Week, a gathering of 120 union leaders from across the world in Switzerland, Jennings told delegates of the need for an “ethical transformation” in the behaviour of banks, and for making institutions more responsible to their own staff and to society at large.

“We are calling on the leaders of large financial institutions to become more aware of who they are and of the communities to which they belong,” Jennings said. “There is a need for big banks to show more responsibility towards the societies they serve.”

The Financial Stability Board – an international body that monitors the global financial system and includes all G20 economies and the European Commission – says it is willing to address the “moral hazard” that has been created by “too big to fail” institutions, by building a resilient financial system.

Speaking at a consultation between the FSB and UNI Finance union affiliates, Financial Stability Board Deputy Secretary General Rupert Thorne said, “The mission of the Financial Stability Board - working for financial stability - is to benefit society at large and not merely the financial sector itself.  We can do this by reducing the risk of new financial crises, reducing the damage crises cause if they do occur, and helping to deliver a resilient financial system that is able to serve ordinary people and businesses, and to support sustainable economic growth and jobs.”

The financial system is anything but for "ordinary people" at present. Since the financial crisis began in 2008, 30 million jobs have been lost with many countries still to fully recover. Trade unions are calling on central banks to wake up to the fact that as well as focusing on price stability, they must focus on the labour market.

Jennings welcomed a new Financial Stability Board paper on structural reforms, published this week, which favours financial stability and better regulation. The paper comes in a week of stress tests for banks within the EU, with fourteen required to build further capital in order to become resilient. The news has already impacted markets, especially in Italy where the stock exchange value of shares of the targeted banks have come down – further threatening jobs.

UNI Finance plans to grow unions, build global bank dialogue, campaign for tougher regulation and a change in banking culture.