Tuesday, March 14, 2017

Bank of England Response To The Resignation of Charlotte Hogg

Press release

Following recent events, Charlotte Hogg yesterday voluntarily offered her resignation.

This morning, Court has accepted her resignation with deep regret. 
Anthony Habgood, Chair of Court, said:

“In her time at the Bank, Charlotte Hogg has made a huge contribution in areas such as professionalising and modernising the management and operations of the Bank, leading the implementation of the strategic plan, championing diversity and driving forward the Bank’s understanding of key issues such as Fintech and Operational Risk.  No one who knows her doubts her track record or her integrity.  While Charlotte’s decision by any measure exceeds the standard that would be expected in the private sector or would be required under statute, it is understandable in the circumstances and she has taken it with the best interests of the Bank at heart.”

Mark Carney, Governor of the Bank, said:

“While I fully respect her decision taken in accordance with her view of what was the best for this institution, I deeply regret that Charlotte Hogg has chosen to resign from the Bank of England.” 

“Since Charlotte joined the Bank almost four years ago, she has transformed its management and operations.  Drawing on her extensive private sector experience and her unrelenting commitment to excellence, she has led a broad range of initiatives to build a more open and inclusive institution, to overhaul our IT systems, and to change fundamentally how the Bank develops, manages and rewards its dedicated public servants. Along the way, she has inspired countless colleagues at the Bank and attracted a new cohort of professionals to it.  The combination of Charlotte’s unique skills and drive were exceptionally well suited to lead similar transformations of our markets and banking responsibilities, particularly given the growing importance of FinTech, operational excellence and the management of cyber risk.”
“The Bank of England today is stronger, more diverse, secure and effective in large part because of Charlotte Hogg.  We will do everything we can to honour her work for the people of the United Kingdom by building on her contributions.”

Court notes today’s report by the Treasury Select Committee.  It is making the following announcements.

The Bank is reconfiguring reporting lines and internal structures in order to safeguard more effectively the governance of its Code of Conduct, compliance and disciplinary processes.  The new configuration will involve:

  • Senior Management Responsibility for Bank-wide risk management moving from the Chief Operating Officer (COO) to Deputy Governor for Prudential Regulation Sam Woods in his capacity as Chair of the Executive Risk Committee.  Mr Woods in turn reports to Court’s Audit and Risk Committee (ARCO) on risk matters.
  • The Head of Compliance reporting to the General Counsel (who in turn reports to the Governor) and the Chair of ARCO, who is tasked with ensuring the independence of the Bank’s compliance function.
  • Senior Management Responsibility for the Code of Conduct will rest with the General Counsel who will ensure the policies under the Code are fully understood and adhered to, and will report on that to the Chair of ARCO.

To ensure adherence to the Code of Conduct at the most senior levels of the Bank, Court has commissioned a review which will be carried out by Court’s non-executive directors other than the Chair. The review will examine:
  • The lessons from Ms Hogg’s case,
  • The extent to which the changes to reporting lines and internal structures outlined above are adequate, and
  • What the Bank should do to ensure full and timely compliance now and in future, especially amongst senior members of the Bank.
The Bank will make the findings and recommendations of this review public. 

The review by Court’s non-executives will be assisted in the first instance by the Bank’s Independent Evaluation Office, the Internal Audit division and the National Audit Office as appropriate.

Letter from Charlotte Hogg

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