9th October 2015

Strengthening accountability in banking: the impact on HR

Written by Philippa Grocott, partner, FSTP

The advent of the Individual Accountability Regime in banking has meant the “people risk” element in banking has suddenly escalated to a must have agenda item for all Risk Committee and Board agendas.  But where does the fallout from the implementation of this new regime and the people risk land?  In most banks it is usually HR.

Over the next few months, if they have not begun already, HR departments are going to have to deal with:

Responsibility mapping

As HR is usually the department that updates the structure charts and/or organigrams, it may be seen as a natural progression for HR to undertake the construction of the responsibilities map.

Updating job profiles

Prescribed Responsibilities will need to be added to job profiles and/or descriptions.

Changes in contracts

The change from a controlled function and a senior management function will need to be amended and new contract terms will need to be drawn up for those undertaking an Approved Person role for the first time. For those that have previously been an Approved Person, the goal posts have moved with the introduction of the “Presumption of Responsibility”. These individuals may also need to have their contracts revised.

Possible resignations

The heightened awareness of accountability may mean individuals are unwilling to undertake a role which will by virtue of the position mean they must hold a new senior management function.


The responsibility mapping may identify a gap in skills and experience required to carry out certain prescribed responsibilities.  There may also be the need to replace people that have resigned.

“Fit and Proper” checks

Everyone who sits under the Senior Managers and the Certification Regimes will have to be assessed as “fit and proper” at recruitment and on an annual basis, which normally resides in the HR department.


Learning and development functions predominantly sit within HRalong with training and competence. New Senior Managers or those significantly changing their function may be called for interview by the regulators and may require help to prepare. The Certification Regime also brings into question the updating of the terms and conditions of schemes and policies, and the inclusion of how relevant individuals will be assessed as competent “in-house”.  Specific training will also need to be organised to understand how the new conduct rules apply specifically to roles.

Statement of responsibilities

Because of the nature of the task,HR will be involved in the documentation even if it is just checking each description does not exceed the prescribed 300 words.

Discipline, capability and grievance

Due to the reporting requirements for breaches and non-competence, policies will need to be amended including failure policies.

The above is not an exhaustive list and activities will differ from bank to bank.

HR has always been an essential part of a robust banking system but now more than ever the department’s value and experience will be appreciated.

For information on how FSTP could assist you with training and consultancy needs in this area, you can contact Philippa Grocott at philippagrocott@fstp.co.uk.

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