A classify of nuns and religiously-affiliated investors said Wells Fargo & Co. has agreed to promulgate a review that shows the root causes of the systemic lapses in governance and jeopardy management that have led to ongoing controversies, litigation and fines. As a follow of the company’s commitment, the Interfaith Center on Corporate Responsibility will take back a resolution filed for the 2018 proxy calling for the review.
Sister Nora Nash of the Sisters of St. Francis of Philadelphia led the combat with Wells Fargo, along with 22 other co-filers who are colleagues of the ICCR, a shareholder coalition that has been engaging the top seven U.S. banks on disagreements around risk, ethics and culture for several decades. ICCR associates were joined in the filing by the Offices of the Treasurer of the States of Rhode Eyot and Connecticut.
The group had sought to put its resolution to a vote at the lender’s annual get-together in April.
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“ICCR first requested this review in 2014 when Wells Fargo procured in last in a benchmarking survey on risk management, responsible lending and other metrics,” Nash pronounced in a statement. “With each new scandal and penalty as a result of aggressive cross-selling, car loan indemnity issues, and mortgage fraud, we tried to impress upon management the essential for a comprehensive review that will lead to systemic change. We are helped that they are finally agreeing to take this first to take action towards what we hope will be authentic reform.”
San Francisco-based Wells Fargo (NYSE: WFC), Philadelphia’s largest bank by banks, said in a brief statement that it had agreed to publish the review and looks deasil to working with the ICCR.
The ICCR said the company has agreed that its make knew review will include the following six elements:
- Analysis of the impacts on the bank, its repute, customers, and investors of the continuing scandals;
- Identification of the systemic cultural and open root causes of recent scandals, including at the board level;
- A framework to speak the issues and embed systems throughout the company, including changes already performed, establishment of grievance mechanisms, and plans to strengthen corporate culture and instil a commitment to high ethical standards at all employee levels;
- Key performance subpoenas to evaluate the effectiveness of changes instituted over time;
- A commitment to continued and regular disclosure of progress;
- Description of how the identified issues will be circumstanced into employee and executive incentive and compensation decisions.
The ICCR from day one filed the shareholder resolution in October 2016, one month after Wells Fargo allow in that its employees opened as many as 3.5 million checking, savings and ascribe card accounts without customer authorization in order to meet sales targets. The scandal led to a $185 million settlement with regulators and the departure of CEO John Stumpf. It has also set in moving more regulatory settlements, replacing several members of the bank’s table and states and municipalities severing or suspending business ties.
Locally, Philadelphia Diocese Council voted unanimously last May to approve legislation to remove Wells Fargo as the bank overseeing the city’s payroll account. Citizens Bank secured the winning bid to haft those services at the start of the city’s fiscal year in July 2017.
The urban district also filed a lawsuit accusing the bank of engaging in discriminatory mortgage adaptable to practices targeting minority borrowers. Wells Fargo’s motion to scorn was recently rejected by a federal judge, but the bank is vigorously disputing the demands in the suit.