Both Virgin Money plc (since October 2018) and Clydesdale Bank PLC are part of CYBG PLC. CYBG PLC is an independent banking group. This statement reflects the achievements of both Clydesdale Bank PLC (trading through the Clydesdale Bank, Yorkshire Bank and B Brands), its subsidiaries Yorkshire Bank Home Loans Limited and Clydesdale Covered Bonds No 2 LLP and Virgin Money plc (trading through the Virgin Money Brand) during 2018 and the combined vision for the CYBG PLC banking group for 2019 and beyond. We will now refer to both Clydesdale Bank PLC and Virgin Money plc collectively as ‘the banks’.
We serve over six million customers across the UK through an omni-channel model of online, mobile and telephone banking and we have a national network of 250 branches and business banking centres. Our ambition is to offer the best service in UK banking, providing customers with market-leading functionality and innovative products, supported by robust technology and a first class, personal customer experience.
Our main offices are in Glasgow, Leeds, Newcastle upon Tyne, Edinburgh, London, Norwich and Chester.
Socially responsible business operations should be the intrinsic foundation in which banking operates. This is reflected in Virgin Money’s recent accreditation as a Living Wage Employer, paying a wage that is calculated according to the basic cost of living in the UK to all colleagues, contractors and suppliers who work on Virgin Money sites. Clydesdale Bank has, since 2016, paid all salaries above the pay recommended by the Living Wage Foundation.
The banks currently have separate due diligence processes in place to mitigate risks in our relationships with both new and existing customers who open and maintain bank accounts with us. These processes include Industry-wide Anti-Money Laundering Know Your Customer (KYC) checks made both at the point of account opening and periodically throughout the customer relationship. These processes will be harmonised across the banks during integration.
In 2018, the banks separately built on existing policies and controls. As an example, Virgin Money introduced a cross-functional Modern Slavery Network, drawing on expertise from across the business to drive co-ordination and oversight of modern slavery activity. This network is the forum to share knowledge and identify and initiate any additional opportunities to strengthen our approach to combat modern slavery.
The banks are committed to complying with legislation and good employment practices when engaging and on-boarding employees. All relevant policies and processes will be reviewed to ensure we deliver against the combined organisation’s commitment to compliance with legislation and good practice when engaging and on-boarding employees and suppliers.
The banks are participants in the Banking Protocol with two main aims; making sure our customers are protected from fraud and helping to identify customers who could be exposed to potential fraud or modern slavery activity. Throughout 2018 the banks separately ensured colleagues benefitted from business wide communications raising awareness of these issues and the actions in place to address the challenges.
In the future, a combined approach will be adopted across the banks to enforce effective systems and controls which minimise the risk of slavery and human trafficking within our business and across our supplier base.
Virgin Money is a member of the Joint Money Laundering Intelligence Taskforce which has a number of operational priorities including ‘understanding and disrupting the funding flows linked to organised immigration crime, human trafficking and modern slavery.’ In line with this we have a number of mechanisms in place to help us identify and highlight customers and employees of suppliers who may be involved in modern slavery including: colleague training; procedures for raising concerns to the Financial Crime team; referrals to the National Crime Agency (NCA).
Clydesdale Bank is an active member of the Financial Services Qualification Scheme, which all key suppliers have been invited to join. Contained within the initial risk assessment that suppliers complete are questions on compliance with the Modern Slavery Act including requesting confirmation from relevant suppliers that they have or intend to publish their own modern slavery statement. We are now gathering collateral, creating dashboard reporting and taking action where necessary based on information provided by suppliers.
During 2018, Virgin Money extended the reach of our training programme, ensuring that colleagues who have direct contact with customers understand what modern slavery is and can identify the signs of someone who may be involved in slavery. This training has been completed by numerous colleagues including those in our branch and Lounge network and our Fraud and Financial Crime team.
Clydesdale Bank include modern Slavery content within Financial Crime learning which all front office customer facing staff complete to develop their awareness of what constitutes criminal activity and the indications of this. This training is specifically tailored to audience needs and has been delivered through different mediums depending on requirements.
During 2019 and beyond, colleagues across the banks will receive training on our updated policies and processes impacting or informing our approach to modern slavery.
The banks rely on the use of suppliers to support the delivery of high quality services to our customers and the Group, and in doing so we expect all our suppliers to operate in a responsible, ethical, open and transparent way and in compliance with all applicable laws and regulations.
The ongoing integration of the supply bases of Virgin Money and Clydesdale Bank will change the composition of third parties working with the banks. In turn, this will require a further risk assessment to ensure any exposures are fully understood and appropriately addressed. This gives us the opportunity for a deep review of our suppliers’ ethical and socially responsible credentials.
The banks separately have robust sourcing and due diligence processes. These are continually reviewed to ensure they are reflective of the relevant risks. Moving forward, a single approach across the banks will ensure a consistent and thorough assessment of a supplier’s approach to modern slavery, both at sourcing and throughout the life of our relationship with critical, strategic and outsource suppliers.
Our respective supplier codes of conduct set out the standards, principles and behaviours we expect from third party providers to the banks. This places the expectation on our suppliers to operate ethically and with integrity in all our business dealings and relationships and to implement and enforce effective systems and controls. From 2019, the banks will adopt a single supplier code of conduct.
We continue to raise awareness of modern slavery with our suppliers and local businesses. In 2018 Virgin Money held an awareness event with a group of businesses in the construction industry, drawing attention to the risk of modern slavery across industries and providing information to support them in driving change.
To recognise Anti-Slavery Day, Virgin Money held a series of educational events for the wider business to learn more about the issue and how Virgin Money are tackling it, and we published an article to help colleagues understand how they can make a difference both at work and at home.
Clydesdale Bank implemented a supplier communication and verification programme to confirm that suppliers have received and understood the bank’s position regarding modern slavery and are additionally aware of our supplier code of conduct. A series of training communications was directed to internal staff highlighting the issues of modern slavery and human trafficking and how we mitigate potential concerns to look for within our supply chain engagement.
The banks work with suppliers on an ongoing basis to ensure they are aware of the importance of the issue and that they are taking appropriate action, irrespective of whether they are a small business, or a large company required to publish a modern slavery statement.
We measure our success in delivering on our priorities around modern slavery against the following indicators:
The annual risk assessment at Virgin Money identifies a number of suppliers for whom further information is required to satisfy ourselves that appropriate action is being taken to address the modern slavery risks inherent to their business. During 2018, the risk assessment focused on a deeper understanding of a small number of key suppliers. This remains ongoing.
The banks will align and further develop supply chain due diligence, related human rights programme and auditing process in order that any instances of modern slavery can be identified, and remedial action taken.
Training is central to identifying the risk of modern slavery and taking appropriate action, both during the sourcing process and throughout the contractual relationship. A total of 616 Virgin Money colleagues received training through the online training portal during 2018, and supplier relationship managers and procurement colleagues received face to face training.
In the future the banks will deliver a further internal focused awareness campaign to our supplier relationship managers on modern slavery. We will review training opportunities in sectors deemed as heightened risk to both raise awareness of the Modern Slavery Act and help suppliers achieve a higher standard of compliance.
We will continue to use our influence to bring attention to modern slavery amongst our suppliers and colleagues. Clydesdale Bank has recently become a member of Slave Free Alliance, a membership scheme for businesses to improve transparency across their supplier base. Benefitting from their experience, the banks will focus at a deeper level of the supplier base and provide ongoing training to colleagues, turning an emerging business threat into a demonstration of ethical best practise.
This statement has been published pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes Clydesdale Bank and Virgin Money’s slavery and human trafficking statement for the 2018 financial year. It has been approved by the Board of Directors and will be reviewed annually.
CEO CYBG PLC GROUP
Socially responsible business should be the intrinsic foundation in which banking operates. Colleagues across the organisation understand the significance of the ethical standards the bank has set and these are at the forefront of how we perform our roles.
We have a proud history as an inclusive employer – our culture encourages a positive and supportive workforce, with robust and effective polices to underpin that culture. Modern businesses face a number of issues and challenges, and one which is of utmost importance is the risk of slavery and human trafficking – an issue that we have stringent controls in place to minimise.
We have a sustainable approach to Corporate Responsibility and we aim to make a positive impact on the lives of our customers, people, communities and the environment we operate in. Our responsibility in delivering this positive impact is not taken lightly and the culture we have created, and work done to date, will continually reflect our dedication to run a business fit for the modern world.
CYBG PLC is an independent banking group. Our business is conducted through our Clydesdale Bank and Yorkshire Bank brands. Within our group is Clydesdale Bank PLC which in turn has a number of subsidiaries. This statement equally applies to Clydesdale Bank PLC, Yorkshire Bank Home Loans Limited and Clydesdale Covered Bonds No 2 LLP. Bank employees are employed by and procurement of services is made mainly via, Clydesdale Bank PLC.
Our aim is to implement and enforce effective systems and controls to minimise the risk of slavery and human trafficking taking place. Our robust policies on Corporate Responsibility can be found accessed here. Our policies and procedures are under continuous review to reflect the changes in the environment in which we operate.
We are committed to ensuring that we remain compliant with legislation and good employment practices with respect to the engagement and onboarding of employees.
We employ rigorous approaches to ensure that those engaged to work for us meet the highest standards of fitness and propriety, are fully referenced and have the right to live and work in the United Kingdom (UK). This contributes to the prevention of illegal working and modern slavery.
Our recruitment policy sets out the standards expected of those being engaged to work for us and we have a third-party provider who undertakes stringent pre-employment screening on our behalf. Those employed directly by us must demonstrate the right to live and work in the UK before undertaking employment. All employment offers are subject to this condition.
We provide recruiting managers with guidance on how to validate documentation provided by candidates evidencing the right to work in the UK. Recruiting managers are required to copy the documents and attest to that they have seen the originals.
In addition to checking that candidates have the right to work in the UK, checks also involve criminal record vetting, credit checks and fraud prevention database searches and checks with the Driving and Vehicle Licensing Agency (DVLA).
In respect of staff not employed by us (for example agency workers), we require that those who have access to our systems, buildings or data undergo vetting to at least the same standard as our own staff, so far as reasonably practicable.
We conduct regular reviews of our contracts with our agency partners and are satisfied that the standards of checks are appropriate.
In respect of companies with whom we have a business to business relationship, our Procurement team where necessary, ensure that obligations are placed on suppliers to appropriately vet their employees and others engaged by them. We have also introduced a Probity Assessment Tool designed to support assessment of the level of checking required. We ensure that third party providers undertake similar checks as a matter of diligence and risk management.
We undertake regular pay audits to ensure that we always pay at or above the minimum wage and negotiate pay arrangements each year with our recognised Trade Union, Unite. In 2016, we reviewed salaries and increased our minimum salary to the sum promoted by the Living Wage Foundation.
Our Whistle Blowing policy supports colleagues in raising concerns relating to Modern Slavery.
We rely on the use of suppliers to support the delivery of high quality, effective and efficient services to our customers and the Bank and in doing so we expect all of our suppliers to operate in a responsible, ethical, open and transparent way and in compliance with all applicable laws and regulations. To this end our standard template services contracts now all contain provisions relating to Modern Slavery. Our tender process requires suppliers to confirm that they comply with the Modern Slavery Act within their organisation.
Our Supplier Sustainability Principles require suppliers to comply with all environmental and social laws and regulations and comply with the UN Convention of the Rights of the Child. Our standard form services agreement contains a schedule that contains these principles and a right to audit suppliers to review their compliance and ability to comply with their contractual obligations.
We will publish our Supplier Code of Conduct which sets out the standards, principles and behaviours we expect from our third-party service providers to the bank. Our Supplier Code of Conduct confirms that we have a zero tolerance to Modern Slavery. In addition, it places the expectation that our suppliers protect human rights as described in the United Nations Universal Declaration of Human Rights, treating individuals with dignity and respect.
The majority of our suppliers are headquartered in low risk countries and due diligence is conducted on our direct suppliers and any material sub-contractors to identify any higher risks countries in the end to end supply chain. Our key suppliers are predominantly within the business processing and professional services sectors however we do engage with some suppliers in higher risk sectors such as guarding, corporate clothing, cleaning and enhanced due diligence is conducted where higher risk characteristics are evident.
We have recently undertaken awareness training with staff who are involved with sourcing activities and those involved in managing our key supplier relationships.
We recently became a member bank of the Financial Services Qualification Scheme and all our key suppliers have been invited to join where they are not already members. Contained within the initial risk assessment that suppliers complete are questions on compliance with the Modern Slavery Act including requesting confirmation from relevant suppliers that they have or intend to publish their own Modern Slavery statement.
We have due diligence processes in place to mitigate risks in our relationships with both new and existing customers who open/maintain bank accounts with us. These processes include Anti-Money Laundering Know Your Customer (KYC) checks made both at the point of account opening and periodically throughout the customer relationship.
Within the next year, additional compliance training will be developed to enhance knowledge across the Bank of the MSA and associated risks.
This statement is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes our group’s slavery and human trafficking statement for the financial year ending 30 September 2017.