Trust deficit is eating at sector: Mullins
A lack of trust is the single biggest threat to the future of the financial services industry, according to a Dear CEO letter penned by Shane Mullins, the managing director of Fiscal Engineers.
In a note sent to chief executives across the UK, Mr Mullins said: “The UK’s gaping trust deficit is the number one threat to the future of this country’s financial services sector.
“Today, survey after survey confirms that trust is in short supply. No amount of expensive and cumbersome legislation, regulation or governance can persuade people that the financial services industry can be relied upon to put the customer’s interests first and foremost at all times.”
Mr Mullins said urgent action was needed. He added: “All it takes for distrust to thrive is for good men and women to do nothing.
“Together we can rebuild the trust that is essential to generate better outcomes and returns for all stakeholders in the UK financial services industry.”
He blamed the erosion of trust in the industry on years of poor standards.
He added: “This is the result of years of well-documented abuse, mis-selling, churning, toxic debt instruments, over-charging, governance failures and a bonus culture. All these have contributed to the alienation of the customer from our industry.”
Mr Mullins is the driving force behind the trust campaign, which is also supported by the Institute of Financial Planning, Credit Action and Financial Adviser.
The campaign aims to establish a benchmark for firms through an accreditation process delivered through the IFP. The process would build on the accredited firms’ status already in place by conducting regular assessments – trust audits – by independent experts.
Speaking about the campaign, he said: “The Question of Trust campaign will strive to return to the moral high ground and the pursuit of integrity. The campaign recognises that failure to repair the bonds of trust between customers and our institutions will destroy value, jobs, businesses and lives.
“The stakes really are that high. It just does not have to be that way. The Question of Trust campaign is committed to transforming the trust deficit into a trust dividend. Billions of pounds of value could be unlocked by creating an environment that convinces customers that their security and peace of mind is the key objective rather than pushing products or generating commission.”