Minutes of the Meeting of the Court of Directors held on 31 October 2023

8. Q2 Quarterly Finance Report and 2024/25 Budget Update

(Ed Moore and Kristy Eden-Green)

Interim Chief Financial Officer, Ed Moore, and Kristy Eden-Green updated Court on the Bank’s Finances and Budget.

Ed Moore said Court would be updated on the Bank’s business plans at a forthcoming meeting.

Ed Moore also updated Court on upcoming changes to the means by which the Bank funds its activities, moving from the Cash Ratio Deposit scheme to a new Bank of England Levy, as outlined in the Financial Services and Markets Act. Court noted the importance of this change for the ability of the Bank to fund execution of its full range of responsibilities in future.

9. Six-monthly Risk Update

(Stephen Brown and Rebecca Estrada-Pintel)

Stephen Brown presented his six-monthly risk update to Court, focussing on non-financial risks. He highlighted risks associated to technology obsolescence and the recent outage of RTGS, as well as risks stemming from geopolitical developments.

Rebecca Estrada-Pintel updated Court on financial risks to the Bank.

With regards to the Bank’s market operations, Court observed that the lending made under TFSME was due to be repaid.

10. Cyber Security Strategy

(Jono Pagett, Eloise Hindes)

Jono Pagett presented the Cyber Security Strategy to Court. He outlined how it would maintain and build on the maturity of the Cyber Security function, while responding to a changing threat landscape and expanding technology estate.

Court supported and endorsed the Cyber Security Strategy. It was noted that the Cyber Security Strategy would return to Court when further analysis of the cost had been undertaken, should the forecast spend be over £10mn or the scope of the Strategy change significantly.

11. Court Review of Ethnic Diversity and Inclusion and Gender Equality Update 2023

(Jane Cathrall, Sarah Guerra, Ragveer Brar and Katie Farrant)

Sarah Guerra updated Court on progress on delivering the recommendations of the Court Review of Ethnic Diversity and Inclusion, and gave the Gender Equality Update.

Court noted the impact that the Review had across the Bank, enabling open conversations and better understanding of the challenges the Bank must overcome.

Court agreed that diversity targets were helpful, though they could be further embedded into processes to ensure that individuals were supported earlier in their careers. Whilst it was important to keep the focus on executing the court action plan, the team were encouraged to explore where this would also benefit other protected characteristics and generally contribute to a more inclusive Bank.

The Chair asked that NomCo be updated on the Bank’s Gender Action Plan by April 2024.

The Chair observed that a theme common to both the update on Ethnic Diversity and Gender Equality was the consistency and skill levels of people managers. Work was being undertaken to address this, and improve the performance of people managers.

Court agreed that the Court Review should be tabled for discussion at Court annually, providing a high-level overview of how the Bank is performing.

Court thanked the presenting team for their continued work to ensure that the Bank is a diverse and inclusive employer and noted the importance of that on the Bank’s ability to fulfil its objectives.

12. Approval of arrangements for FMIC

(Sasha Mills and Sarah Parkinson)

The Terms of Reference for the new Financial Market Infrastructure Committee (FMIC) were presented to Court. The FMIC was due to be placed on a Statutory footing by the end of the year. As such, Court would become responsible for approving its operating procedures – and be responsible for reviewing its effectiveness, in the same way as for the MPC, FPC and PRC.

In response to questions from non-executive members of Court, Sasha Mills noted that the FMIC would have rule-making powers as a result of legislative changes, which underpinned the need for greater accountability relative to FMI Board it replaced.

Court agreed to approve the membership of the Committee via Written Procedure.

Court approved the Terms of Reference.

13. Conflicts of Interest policies

(Sebastian Walsh, Michael Salib and Alison Kavanagh)

Michael Salib presented the Bank’s conflicts of interest policies for their annual review, alongside the statutory conflicts codes for the Bank’s policy committees.

Court welcomed the revisions.

Court approved the revisions to statutory conflicts codes and agreed that they could be shared with HMT for consultation.

Court delegated to the Chair the authority to approve the revisions to the non-statutory conflicts codes.

Court approved the conflicts of interests policies as set out in Our Code.

14. PRC Effectiveness Review 2023

(Michael Salib)

The Chair said that he had undertaken a regular effectiveness review of the PRC, supported by the Deputy Secretary, Michael Salib. The review concluded that the PRC was functioning well and effectively, PRC felt well supported by the Secretariat and Bank staff.

15. Committee Appointments and Conflicts update

(Sebastian Walsh)

Court noted the paper and discussed future recruitments.

David Roberts noted that applications for the role of Deputy Governor for Monetary Policy were due to close on 6 November.

Sebastian Walsh noted for the record that Court had approved, by written procedure, the appointment of Nathan Monk as CIO, Nathanael Benjamin as Executive Director for FSSR. Court had also approved, in same manner, the promotion of James Talbot Executive Director for International, becoming responsible for the Bank’s Climate work in addition to his existing responsibilities.

16. Items for Information

Court noted:

• Monetary Policy Committee Report
• Enforcement Decisions Making Committee Procedures
• Publication of the Bank’s Discussion Paper on the proposed regulatory regime for systemic payment systems using stablecoins, as part of a cross-authority package.

The meeting of Court was closed.