Efficiency and cost effectiveness underpins all the Bank’s operations. We will strive to have the people, systems and structures in place to maximise our effectiveness. Cost control within our operations and optimising the return on the Bank’s investment portfolio will be key considerations in our financial and planning processes. Our operations will also be conducted within well-defined risk management and control frameworks.
Corporate Governance and Internal Controls The Bank is committed to having in place a Corporate Governance Framework which reflects best practice. This is being achieved through the development and communication of a set of principles, policies and procedures. These policies and procedures are forms of internal controls to ensure compliance to key corporate governance and organisational objectives. The effectiveness of these internal controls is reviewed regularly through an independent audit process. The Central Bank Commission is also actively involved in the monitoring of good corporate governance practices. We are committed to maintaining high standards of public accountability, while at the same time asserting our statutory independence.
There are government proposals to bring the Bank within the Freedom of Information Act and to introduce specific arrangements for whistle blowers. These are welcome developments and the Bank will work to ensure that the necessary arrangements are in place to ensure our responsibilities are fully and properly carried out in this regard once the relevant legislation is introduced.
Optimise the Return on the Bank’s Assets
The return on the Bank’s investment assets is normally the primary source of income for the Bank. We will carry out a fundamental review of the investment strategy in relation to the investment and superannuation fund portfolios with a view to optimising the long-term return on these portfolios. The Bank will also continue to effectively manage the share of the pooled portion of the ECB’s own foreign reserves and the Bank’s pension fund which are managed on an agency basis. This fundamental review must also take into account the risk of the
Bank’s total balance sheet which has increased significantly both in size and risk profile since the financial crisis began.
Management of Risk
We aim to manage organisational risks within the Bank’s risk tolerance. Of fundamental importance here is the application of effective risk management frameworks in order to mitigate significant potential financial and non-financial risks arising in the Bank’s activities/operations. In particular, we aim to:
» embed risk governance and risk management in the Bank;
» ensure the Bank’s risk tolerance is appropriately defined;
» ensure balance sheet risks are managed effectively through enhanced qualitative and quantitative analyses, due diligence and institutional arrangements;
» ensure financial risks related to the investment and superannuation portfolios are managed effectively through a comprehensive risk management framework;
» ensure business continuity risks are managed effectively through accurate requirements gathering, planning, testing and incidence response; and
» ensure operational risks are identified and managed effectively through accurate and timely identification, mitigating actions and incidence response.
Human Resources
The important role of the Bank in assisting in the resolution of the financial crisis in Ireland as well as fulfilling its other statutory objectives has led to significant growth in the organisation, particularly in the areas responsible for financial regulation and the functions which provide internal support to the business areas. It has been necessary to broaden the skills base and knowledge profile of staff. This has been achieved through recruitment and an increased focus on training and development. A key focus during the coming years will be to ensure staff have the skills to effectively undertake their roles, and create on-going
39 Strategic Plan 2013–2015 learning and development opportunities to ensure that
staff can reach their potential.
A Human Resources (HR) Strategy has been developed and is being implemented and continuously aligned to the overall strategic direction of the Bank. Key elements of the HR Strategy include:
» talent management, flow of people and the development of leadership capability;
» business alignment and continuous focus on performance management;
» efficient resource deployment; and
» staff engagement and the effective management of change.
Information Management (IM) and Technology In addition to having the appropriately skilled staff in place, it is vital to have systems and processes in place to support the business goals. An Information Management Strategy (IM Strategy) has been developed and will be implemented and aligned to the overall Strategy for the Bank.
The goal of the IM Strategy is to define a future proofed IM landscape that will deliver analytical excellence, operational efficiency, optimised cost of ownership and automation/process improvement. The core capabilities and activities in delivering the IM Strategy are linked to these organisational objectives recognising the significant changes that are occurring in both the regulatory and central banking environment and the fact that there is widespread organisational change taking place within the Bank. The IM Strategy will be implemented in a manner that allows flexibility and responsiveness to business demands. The key capabilities in the IM Strategy are:
» Collaboration: the ability to collaborate and communicate internally, with regulated entities, with peer organisations across the ESCB, with relevant authorities, and with partners and suppliers.
» Data Collection: the ability to collect data securely from regulated entities and from sources externally and internally, and to support a variety of formats with varying levels of verification and validation.
» Document Management: the ability to collate and store a wide variety of document types so that information within documents is searchable and documents are easily retrieved.
» Analytics: the ability to manage and store a wide variety of data and providing the ability to interpret data and deliver information to support business insights and outcomes.
» E-Discovery: the ability to forensically secure, manage and review evidence for the purposes of ensuring Enforcement.
» Security: ensuring that business activities are conducted and maintained in a secure manner.
» Technology: ensuring that the right technology is used in the right places in the right ways. A prioritisation process has also been designed and is aligned to the overall business goals to ensure scarce resources are targeted at the most pressing and important projects.
Another significant project which will be completed in 2013 involves moving to a new Data Centre which will be managed externally. This will address the urgent requirement to meet the critical demand for increased computing capability to support the Bank’s broader and deeper regulatory information acquisition and analytical capabilities and will also mitigate the risk to the organisation of inadequate infrastructure, for the systems and applications supporting the Bank’s business.
Regulatory Information Process Improvement A separate function has been established to deliver regulatory process improvement. In particular it aims to centralise, streamline and automate regulatory transactions. It currently assesses applications from prospective Pre-Approval Control Function (PCF) holders and has standardised and improved the on-line returns submission process for receiving information on-line from regulated entities. Between now and 2015, in addition to the continuous improvement of the existing processes, the Bank will improve a number of other business processes including authorisations, passporting, revocations, acquiring transactions and contact management. For low impact firms, we intend improving the authorisations process by moving towards the receipt of information in electronic format and developing automated workflow processes. We also intend implementing a new contact centre to make it as simple as possible for the smaller firms we regulate to do business with us.
Implementing the Regulatory Transactions Strategy will allow the Bank to:
» deliver a clearly measurable and transparent service with improved turnaround times;
» make it easier for regulated entities to communicate electronically with the Bank, through the on-line submission of information and increased use of on-line reporting; and
» improve the quality of regulatory information. Industry Funding
The Bank is undergoing a consultation process with the financial sector on the levy calculation process in respect of financial regulation. As part of this process, the Bank will propose reforms designed to make the process more equitable and transparent. The most significant reform represents a logical extension of our view that the impact categorisation of regulated entities, within and across industry categories, allows us to improve our targeting of supervisory resources. Given that the impact categorisation of a firm determines the number of supervisors allocated to it, the proposed approach provides an opportunity to more closely align the funding by regulated entities with the costs of supervision. We expect that the adoption of this impact-based approach to the levy calculation process will, from 2014 (assuming agreement and implementation of the new approach in 2013), lead to a reduction in the complexity of the process thereby leading to greater efficiency while at the same time facilitating earlier issue of the levy notices for the year in question. We will also propose the introduction of application fees for those firms seeking authorisation in respect of the provision of financial services which will reflect the cost involved in the processing of applications. Further recommendations regarding the treatment of monetary penalties, pro-rata levies and unpaid levies will also be incorporated into this Consultation Paper. Premises
With the significant increase in staff numbers over the past number of years, it was no longer possible to accommodate all staff in the existing city centre location. Additional premises were procured and the Bank currently operates from four separate locations, including the Currency Centre.
A detailed evaluation was carried out to assess the most cost effective long-term solution for staff accommodation. The conclusion of this exercise was that a single premises for all city-based staff is optimal and will deliver long-term benefits both
in terms of cost and operational effectiveness. A site has recently been identified and a significant project is underway to develop this site and deliver an accommodation solution by 2015. We will maintain our existing premises as required while considering an appropriate asset disposal plan for these premises.
Efficiency and Cost Control
The achievement of operational efficiency and cost control mechanisms are key objectives of this Strategic Plan. In that context, comprehensive approval frameworks have been implemented in the areas of staff recruitment and the procurement of goods and services. Monitoring and oversight of expenditure will be underpinned by new detailed cost and financial reporting systems.
Communications
The Bank will continue to keep our corporate communications policies under review. As an organisation which attaches primacy to the public interest, the Bank endeavours to have transparent, comprehensive and active systems of public accountability and external reporting. This is achieved through external publications, the website and direct interaction with the media, representative bodies and the public. We will continue to review and improve all channels of communication to ensure that relevant and accurate information is available in a timely manner. We will also develop our liaison with the educational sector to provide students with information on the operations of the Bank and of the Eurosystem.
We have developed a consultative approach with stakeholders to policy formulation and will continue to pursue this objective and to explain the rationale for significant policy decisions.
We have placed significant emphasis on the requirement for good internal communications and have put in place a number of measures to enhance this function. As the organisation has grown significantly, it is crucial that all staff are aware of the Bank’s functions and operations and that necessary cross communications are promoted.
41 Strategic Plan 2013–2015
Strategy Action
Apply high standards of
corporate governance » Review policies and practices and ensure compliance with legal obligations and corporate policies
» Ensure necessary arrangements are in place for the application of the Freedom of Information Act to the Bank » Use a balanced scorecard approach to measure
organisational performance against strategic objectives » Ensure staff operate with integrity and comply with our
Principles and Behaviours
» Ensure internal procedures and practices are reviewed on a regular basis
Optimise returns on Central
Bank assets » Manage investment and superannuation fund portfolios within defined risk parameters
» Manage our share of the pooled portion of the ECB’s own foreign reserves and act as portfolio manager for ECB reserves of other member state(s)
Manage and mitigate risks
across the organisation » Embed risk governance and risk management in the Bank » Ensure the Bank’s risk tolerance is appropriately defined
» Ensure balance sheet risks are managed effectively through enhanced qualitative and quantitative analyses, due diligence and institutional arrangements
» Ensure financial risks related to the investment and superannuation portfolios are managed effectively through a comprehensive risk management framework
» Ensure business continuity risks are managed effectively through accurate requirements gathering, planning, testing and incidence response
» Ensure operational risks are identified and managed effectively through accurate and timely identification, mitigating actions and incidence response
» Establish a quality assurance role to review key processes to check compliance with standards and internal controls
Strategy Action Implement HR Strategy
to build organisational effectiveness
» Ensure we create and maintain an organisation that is fit for purpose, maintains the correct level of skill base, and leadership capability to deliver our goals
» Enhance our organisation capability through application of key success levers including
- Knowledge management - Succession planning - Coaching and mentoring - Career paths and job families - Talent management
» Ensure smarter and efficient work practices while recognising appropriate work life balance for staff
» Build on the improving staff engagement levels to create a progressive inclusive high performing culture
» Drive innovation and change management as a core competence in our organisation
» Further embed the performance management processes to support a continuing focus on improved team and individual performance
Implement the Information Management Strategy
» Enhance our capabilities through the effective use of technology in
- Data collection
- Document management - Data analytics
- E-discovery
43 Strategic Plan 2013–2015
Strategy Action
Implement Regulatory
Transaction Strategy » Improve quality of process - Deliver improved automated processes for
authorisations, passporting, revocations and acquiring transactions
» Improve quality of regulatory information
- Increase the submission of electronic information in line with peers
- Increase on-line reporting usage from 25% of firms to 90%+
» Improve quality of service
- Implement and publicly measure external service standards, including target turn-around times - Implement on-line portal with improved information,
guidance and media content
- Implement on-line self-service information management model
Manage transition to a new
premises by 2015 » Migrate all city centre staff to new building » Manage the disposal of current premises
Review our Corporate
Communications Strategy » Enhance the Bank’s website and on-line presence » Maintain effective communication channels with external
stakeholders
» Improve and enhance on-line publications/reduce reliance on paper based material
» Effectively manage our media and public relationships » Provide information to the public
Optimise the efficient
allocation of resources » Implement a more centralised budget oversight » Ensure compliance with domestic and European
procurement rules
Enhance levy collection
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Central Bank of Ireland PO Box 559 Dame Street Dublin 2 Tel: 224 6278 Fax: 671 6561 Email: [email protected] Web: www.centralbank.ie