Today's banks are juggling with different standards. On the one hand, strict laws and regulations. On the other, ethical rules that are sometimes blurred. This grey area between obligation and recommendation is worth exploring to understand how these requirements fit together and what the implications are for customers.
Introduction to banking ethics
Ethical banking rules have emerged gradually, particularly since the 1990s. These professional standards fall between government regulations and the simple contractual obligations between a bank and its customer. They aim to provide a framework for the banker's professional duties beyond strict compliance with the law.
According to the French Monetary and Financial Code, in particular article L. 612-1, II, 3°, the Autorité de contrôle prudentiel et de résolution (ACPR) ensures compliance with "best practices in their profession that it observes or recommends". This wording highlights the hybrid nature of these rules, which oscillate between soft law recommendations and quasi-regulatory obligations.
It is important to distinguish between ethics and deontology. As P.-F. Smets explains, ethics, initially limited to general moral duties such as loyalty or integrity, have become "more detailed, more prescriptive, more authoritarian", sometimes emanating from the profession's representative bodies or even from public authorities. Banking ethics therefore do not impose immutable moral principles, but practical rules adapted to a constantly evolving sector. It aims to establish coherent professional 'rules of the game' and to guarantee a certain level of conduct expected of players in the sector.
The evolution and limits of the rules of good conduct
Historically, the first rules of banking ethics focused on the security of transactions. For example, in a ruling handed down on 17 February 1989, the Paris Court of Appeal considered the obligation to check a customer's identity and address to be a measure to prevent fraud, and thus part of good professional practice.
These rules then evolved towards greater customer protection. J. Moret-Bailly describes this progression as reflecting "a deep-seated desire for fairness and equity in relations between professionals, but also with their customers and users, and more broadly with the public". This development has been strongly influenced by European law, which has encouraged the adoption of "codes of conduct" to begin unifying banking practices despite the disparities in national regulations. A notable example is the transparency of banking conditions for cross-border transactions: initially a simple recommendation in 1990, this principle was gradually transformed into a directive and then into a regulation, leading to the alignment of charges for cross-border payments in euros.
However, self-regulation has its limits. The use of charters and codes of conduct is not always enough to guarantee the desired results. The 1992 Charter of Basic Banking Services is a case in point: despite its existence, the public authorities had to take legislative action to enshrine the right to an account and to define precisely the content of the basic banking service by decree (Decree no. 2001-45 of 17 January 2001).
Another risk inherent in self-regulation is the potential conflict of interest. The drafting of rules by the profession itself can sometimes be aimed at preventing state regulation deemed too restrictive. As F. Osman notes, corporatist sentiment rarely leads to the adoption of codes of conduct that are stricter than existing state law.
The relationship between self-regulation and state regulation
Faced with the limits of pure self-regulation, a hybrid system has developed. Banking ethics rules are often drawn up by the professionals themselves, via their associations (such as the Fédération Bancaire Française - FBF), but in consultation with the regulatory authorities.
The intervention of the State or independent authorities such as the ACPR has become a necessity to guarantee the effectiveness and legitimacy of these standards. The Delmas-Marsalet report of 2005 recommended that professional codes of conduct should be approved by the public authorities to give them a broader scope.
In concrete terms, this hybridisation can be seen in :
- Approval of certain codes of conduct by order of the Minister for the Economy, giving them quasi-regulatory force (mechanism introduced by Order no. 2008-1271 and extended by Act no. 2010-1249).
- Approval of codes of conduct by the ACPR, making them mandatory for members of the professional associations concerned.
- The formulation of recommendations directly by the ACPR to define best practices.
This mixed system combines the flexibility and technicality of self-regulation with the legitimacy and binding force provided by the validation or impetus of the public authorities. The control of ethical rules is thus shared.
The advantages and disadvantages of banking ethics
Professional ethics offer considerable flexibility. It makes it possible to rapidly draw up rules adapted to the specific technical features and rapid changes in the banking sector, where the legislative or regulatory process would be more cumbersome and slower. As François Schwerer points out, quoting Dominique de la Garanderie, the proliferation of codes of ethics is a response to the legal uncertainty created by globalisation and the growing complexity of legal systems.
Nevertheless, the disadvantages remain. In addition to the limitations already mentioned (variable effectiveness, risk of conflict of interest), the legal value of these ethical rules can be ambiguous for the uninitiated. The distinction between a simple recommendation, observed good practice and an approved standard is not always clear, which can lead to confusion as to whether the rule is really binding.
Ultimately, banking ethics are a valuable tool for providing a framework for professional practices, but they cannot entirely replace clear state regulation and rigorous supervision by the competent authorities. Its effectiveness depends on a subtle balance between professional initiative and public supervision.
If you are experiencing difficulties with your bank and suspect that it is failing to meet its obligations, whether legal or ethical, you should seek the assistance of a lawyer in banking ethics can prove decisive in asserting your rights. Do not hesitate to contact our firm for an analysis of your situation.
Sources
- Monetary and Financial Code, in particular article L. 612-1, II, 3°.
- Order no. 2008-1271 of 5 December 2008 on the introduction of codes of conduct.
- Act no. 2010-1249 of 22 October 2010 on banking and financial regulation.
- Decree no. 2001-45 of 17 January 2001 on basic banking services.
- Smets, P.-F. (2002). Ethics or cosmetics, the return of values in a paradoxical world. Bruylant.
- Moret-Bailly, J., & Truchet, D. (2010). Legal ethics. PUF.
- Osman, F. (1995). Opinions, directives, codes of conduct, recommendations, deontology, ethics, etc. réflexion sur la dégradation des sources privées du droit. RTD com., 509.
EN 
FR