Barclays 2014 Annual Report Download - page 139

barclays.com/annualreport Barclays PLC Annual Report 2014 I 137
Overview
The Group defines, manages and mitigates conduct risk with the goal
of providing good customer outcomes and protecting market integrity.
The Group has defined 10 outcomes which are positive indicators that
it is delivering good customer outcomes and protecting market
integrity:
Q Culture places customer interests at the heart of strategy, planning,
decision making and judgements
Q Strategy is to develop long-term banking relationships with
customers by providing products and services that meet their needs
and do not cause detriment
Q Does not disadvantage or exploit customers, customer segments or
markets, and does not distort market competition
Q Proactively identifies conduct risks and intervenes before they
crystallise by managing, escalating and mitigating them promptly
Q Products, services and distribution channels are designed, monitored
and managed to provide value, accessibility, transparency, and to
meet the needs of customers
Q Provides banking products and services that meet customers’
expectations and perform as represented. Representations are
accurate and comprehensible so customers understand the products
and services they are purchasing
Q Addresses any customer detriment and dissatisfaction in a timely
and fair manner
Q Safeguards the privacy of personal data
Q Does not conduct or facilitate market abuse
Q Does not conduct or facilitate financial crime
Organisation and structure
The Conduct and Reputational Risk Committee (CRRC) is a sub-
committee of the BCORR. The principal purpose of the CRRC is to
review and monitor the effectiveness of Barclays’ management of
Conduct and Reputation Risk. The Conduct Risk Committee (CRC) is a
senior executive body responsible for the oversight and challenge of
Conduct Risk and the control environment within Barclays. The outputs
of the CRC are presented to the CRRC and the BCORR.
In addition, specific committees monitor conduct risk and the control
environment at the business level.
Roles and responsibilities
The Conduct Risk Principal Risk Framework (PRF) comprises a number
of elements that allow the Group to manage and measure its conduct
risk profile. The PRF is implemented across the Group:
Q Vertically, through an organisational structure that requires all
businesses to implement and operate their own conduct risk
framework that meets the requirements detailed within the ERMF
Q Horizontally, with Group Key Risk Officers (KROs) required to monitor
information relevant to their Key Risk from each element of the
Conduct Risk PRF
The primary responsibility for managing conduct risk and compliance
with control requirements is with the business where the risk arises.
The Conduct Risk Accountable Executive for each business is
responsible for ensuring the implementation of, and compliance with,
the Group Conduct Risk framework.
The Conduct Principal Risk Owner is responsible for owning and
maintaining an appropriate Group-wide Conduct Risk PRF and for
overseeing Group-wide Conduct Risk management.
Businesses are required to report their conduct risks on both a
quarterly and an event-driven basis. The quarterly reports detail
conduct risks inherent within the business strategy and include
forward-looking horizon-scanning analysis as well as backward-looking
evidence-based indicators from both internal and external sources.
Business-level reports are reviewed within Compliance. Compliance
then creates Group-level reports for consideration by CRC, CRRC and
BCORR. The Group periodically assesses its management of conduct
risk through independent audits and addresses issues identified.
Event-driven reporting consists of any risks or issues that breach
certain thresholds for severity and probability. Any such risks or issues
must be promptly escalated to the business and the appropriate KRO.
Conduct and Reputational Risk Committee
Board Conduct Operational and Reputational Risk Committee
Conduct Risk Committee
Responsible for the oversight and challenge of conduct risk and control environment within Barclays
Conduct risk
The risk that detriment is caused to customers, clients,
counterparties or the Group because of inappropriate
judgement in the execution of the Group’s business
activities.
Risk review
Risk management
Conduct risk management
The Strategic Report Financial review Financial statements Shareholder information
Risk review
Governance