MM Profile: The Bishop of Durham Justin Welby
Looking down the list of members involved in the Parliamentary Commission on Banking one name sticks out.
A former oil derivatives trader and frequent writer on banking ethics it soon becomes apparent why the Bishop of Durham Right Rev Justin Welby has been included on the committee set up to investigate banking standards following the Libor-fixing scandal.
After studying law and history at Cambridge University, he spent five years in Paris working for Elf on Nigerian and North Sea projects before moving to FTSE 100 firm Enterprise Oil as group Treasurer.
He oversaw all long-term financing and insurance activity while also involved in derivatives and foreign exchange.
In 1989, he had a major career change and left the industry to study theology at Durham university with an emphasis on business ethics. “I was unable to get away from a sense of God-calling. I went kicking and screaming but I couldn’t escape it,” he says.
He spent 10 years working as curate and then a rector in Coventry before becoming a Canon of Coventry Cathedral in 2002 working on sub-saharan Africa conflict resolution.
In 2007, he became Dean of Liverpool cathedral and in June last year the Bishop of Durham including appointment to the House of Lords.
He is also the personal and ethical adviser to the UK Association of Corporate Treasurers, lectures extensively on ethics and finance and chairs a committee on the ethical funds owned by Friends Life and managed by F&C.
He says: “I have a long background of experience in the markets both in plain vanilla products and the more sophisticated ones such as derivatives. Since I have been ordained, I have continued to be involved with the financial markets and I have a fairly widespread experience a good technical knowledge.
“At the same time, I bring a different perspective from having worked for some time in areas at the opposite end of the economic spectrum in deprived areas of extreme poverty.”
On 8 October the commission will see a draft bill and by 18 December it will have produced a report and offered recommendations for the bill.
While Bishop Welby will not be drawn on the specifics to pre-judge the inquiry he offers a flavour of what he might bring to proceedings.
He says: “Focusing on profit alone is an ethic of greed. Banks need to think through their ethics very carefully and many have done so. I don’t know any bank that dismisses the concept of ethical banking.
“The strongest influence in any bank is usually its culture and its habit of working. Obviously we have regulations and they are important but what finally tips things in an institution is the instinctive reaction to go in a certain way.”
He is a regular writer on business ethics and international finance issues and has contributed to scrutinising and amending the Financial Services Bill in the House of Lords.
One amendment involves the objectives of the Financial Conduct Authority which currently has three aims; to ensure integrity, foster competition and protect consumers.
Bishop Welby, alongside Baroness Susan Kramer, Lord John Sharkey and Baroness Kay Andrews, is proposing the FCA holds another objective to ensure access to financial services to deprived communities.
He says: “How the FCA would do it is a different question but I believe it is important that part of its objective to make it easier for new market entrants as potential competitors to the big banks. We have the most centralised retail financial services in Europe and there is a need for greater competition.”
He also joined in another amendment regarding the role of the Bank of England governor and its structures and new powers.
He says: “The vast majority in the Lords believe the new governor will be given a job that is almost impossible because it has so many different aspects to it. I was supporting an amendment supporting a stronger role for the deputy governors so the governor did not chair every single committee and be in charge of every single area entirely by her or himself.”
But his passion and priority is creating greater access to finance and tackling problems in deprived areas that are so often ignored by financial services providers.
He says: “There was a fascinating piece of work done by the Co-operative Bank which mapped where free cash machines were in six of our major cities against the most deprived areas in those cities.
“With almost no exceptions there were no free access cash machines in the areas of highest deprivation. Banks weren’t putting them there with very few exceptions. It is a pretty basic access to financial services to get some cash out of the bank and if you have to travel away to do it then it’s inconvenient.”
He extols the role of credit unions and local building societies believing they can compete with expensive payday lenders and illegal, often violent, loan sharks.
Bishop Welby says: “There are a number of regulatory things that could be changed to make it much more likely for credit unions to establish themselves in poorer areas and provide a good, low-cost financial services. It can make a really big difference but it needs someone at the regulator to say it is a good thing.”
He adds: “The only financial services in the deprived areas of my diocese are firms like Wonga and illegal loan sharks willing to use violence. Payday and door to door lenders vary a great deal but they are legal and they are very expensive but I don’t think they should be banned. They should be given some very healthy competition by cheaper and more local forms of finance. It will be more effective than yet more regulation of these firms.”
Born: London, 1956
Education: Eton College 1969-74, Cambridge University 1975-78, Durham University 1989-92
Career: 1979-1984 oil trader at Elf, 1984-1989 group treasurer at Enterprise UK, curate in Nuneaton 1992-95, rector of Southam 1995-2002, Canon of Coventry cathedral 2002-2007, Dean of Liverpool cathedral 2007-2011, Bishop of Durham 2011-present
Drives: A car is my simple answer – as long as it has four wheels the make or model is not important to me
Favourite book: As well as the Bible a current favourite is a collection of poems by RS Thomas
Favourite Film: The Help
Musician: No one comes to mind
Career ambition: None
Life ambition: Wisdom
If I wasn’t doing this, I would be: A vicar or other clergy in business