Remuneration Committee

1. Introduction 

This statement sets out Al Rayan Bank’s approach to understanding all potential modern slavery risks related to its business and to put in place steps that are aimed at ensuring that there is no slavery or human trafficking in its own business and its supply chains. This statement relates to actions and activities during the financial year 1 January 2019 to 31 December 2019.

In previous years, The Bank has published its statement no later than 30 June. We recognise that we are publishing this statement later than expected. This is because of reduced staff capacity and increased difficulty in gathering the required information during the coronavirus pandemic.

As part of being a Bank within the Financial Services sector, we recognise that we have a responsibility to take a robust approach to slavery and human trafficking.

The Bank is absolutely committed to preventing slavery and human trafficking in its corporate activities, and to ensuring that its supply chains are free from slavery and human trafficking.  Al Rayan Bank does not invest in any business that is involved in alcohol, gambling, pornography, speculation, tobacco, arms, and other activities not in keeping with the ethical values of Islam.

2. Organisational structure

Al Rayan Bank is the UK’s oldest and largest Sharia compliant retail bank. We have been pioneering British Islamic finance since 2004.

By solely focusing on banking activities which are in keeping with the principles and values of Islam, Al Rayan Bank is able to make a significant and lasting difference to customers throughout the UK, helping them to save for their families’ futures, expand their businesses or buy their own homes, without compromising their beliefs.

With a strategically located branch and office network throughout the UK, a highly trained contact centre, secure digital banking services and 24-hour automated telephone banking, Al Rayan Bank provides Sharia compliant savings, finance and current account products to over 85,000 personal, business and premier customers.

3. Organisational Approach  

The Bank’s approach for 2020 has been highlighted below: 

Responsibility for the Bank’s anti-slavery initiatives:

  • Policies: We operate a policy governance framework across the Bank. Each policy is owned by a Subject Matter Expert and then approved via stakeholder engagement, a sub-committee and a decision-making committee which is always at Executive Committee Level or above. All policies are reviewed at least annually or within a shorter time frame if required. The robust Governance approach ensures the Bank gives due consideration to all its responsibilities, including our Modern Slavery obligations.
  • Risk assessments & due diligence: We have a Procurement function within Operations which supports each business area’s assigned vendor relationship management owner(s) on ensuring they undertake periodic due diligence and compliance monitoring activities of their vendor supply chain in both a comprehensive and timely manner in accordance with the Bank’ approved policies.  As a Living Wage employer, we have a dedicated HR team who focus on creating a culture which delivers more than our statutory obligations. All vendors to our business go through a risk assessment before we agree to work with them. 
  • Training: We are committed to the training and education of all colleagues and contractors. Our aim is to ensure all colleagues understand and respond to any identified slavery and human trafficking risks
  • Colleagues: All colleagues are made aware of their employment rights through their employee handbook, employment contracts and our company policies. We aim to pay at market median with reference to recognised national salary surveys.  The Bank is a Living Wage employer with Investors in People Silver status. All our colleagues and contractors go through our onboarding process which includes vetting their right to work in the UK and attendance at our corporate induction. 

4. Ethical Principles 

As a Bank which operates under Islamic Finance principles, we pride ourselves on providing an ethical alternative to conventional Banking. Our core values are focused on embodying our Sharia principles and having people at the heart of our business operations. We have a dedicated Sharia Compliance and Product Development team who review all of our policies to ensure we are ethical in our approach and avoid any type of exploitation of any of our stakeholders.  

Relevant policies

The Bank operates the following policies that describe its approach to the identification of modern slavery risks and steps to be taken to prevent slavery and human trafficking in its operations:

  • Whistleblowing policy: The Bank encourages all its colleagues, customers and other business partners to report any concerns related to the direct activities, or the supply chains of the Bank. This includes any circumstances that may give rise to an enhanced risk of slavery or human trafficking. The Bank's whistleblowing procedure is designed to make it easy for colleagues to make disclosures, without fear of retaliation. 
  • Colleague expectations: The Bank has transparent policies, training interventions and a Colleague handbook in place to make clear to all colleagues the actions and behaviour expected of them when representing the Bank. We strive to maintain the highest standards of colleague conduct and ethical behaviour when operating and managing its supply chain.
  • Procurement Policy: The Bank is committed to ensuring that its vendors adhere to the highest standards of ethics. Vendors are required to demonstrate that they provide safe working conditions where necessary, treat workers with dignity and respect, and act ethically within the law in their use of labour. All vendors during the initial contracting process and as part of their periodic due diligence (at least annually or more frequent should there be a significant change at the vendor or a trigger event arises) vendor audit will be required to provide a copy of their publicly available Modern Slavery statement, where they are required to have one in place under the Modern Slavery Act 2015. In addition to this all vendors will be asked to provide details of measures they have in place to comply with the said Act and how they further themselves check their downstream supply chains are also complying with The Modern Slavery Act 2015. Any serious violations of our vendor code of conduct will lead to the termination of the business relationship.
  • Recruitment/Agency workers policy: The Bank use only specified, reputable employment agencies to source labour and always verifies the practices of any new agency it is using before accepting workers from that agency.  As with all vendors during the contracting process and as part of their vendor audits Recruitment agencies are required to provide a copy of their publicly available Modern Slavery statement, where they are required to have one in place under the Modern Slavery Act 2015. In addition to this all vendors will be asked to provide details of measures they have in place to comply with the said Act. 

Due diligence

We undertake due diligence when considering taking on new vendors, and also post onboarding for existing relationships periodic due diligence (at least annually or more frequent should there be a significant change at the vendor, or a trigger event arises) vendor reviews are undertaken. Our due diligence and reviews include:

  • Reviewing annually all aspects of the supply chain based on the supply chain risk mapping. Undertaking more periodic due diligence should there be a significant change at the vendor, or a trigger event arises 
  • Conducting supplier audits or assessments, which have a greater degree of focus on slavery and human trafficking where general risks are identified.
  • Creating an annual risk profile for each supplier, plus a risk based manual PEP, sanctions and adverse media screening (at least annually and more frequently if significant changes or trigger events arise), with an aim to move this activity to an automated overnight screening.
  • Invoking sanctions against suppliers that fail to improve their performance in line with an action plan or seriously violate our supplier code of conduct, including the termination of the business relationship – Service reviews include a complete performance review and if failing in any area we would terminate the contract: an example of non-conformance would be a situation where the supplier is not passing on the living wage to its employees having invoiced the Bank for it. 

Performance indicators 

All Performance Indicators are reviewed as part of each vendors’ periodic service review undertaken with their assigned Al Rayan Bank Relationship Manager. Vendors provide the Bank with a copy of their modern-day slavery policy; the vendor is also required to provide evidence and describes their practices against each indicator in accordance with the requirements detailed within their Modern-Day Slavery Policy including Child Labour Policy requirements

5. 2020 Focus 

During 2020 the Bank’s key areas of focus to support and build on modern slavery and Human Trafficking awareness are: 

  • Procurement: Our Procurement function within Operations will be building on our already established foundations, including sampling of our supply chain vendor records updated by the assigned Al Rayan relationship managers to the various relationships to assess and report on levels of adherence to the Bank’s approved Procurement Policy. This includes supporting business relationship managers and reviewing all recruitment partners we work with, ensuring adherence to our Procurement and Outsourcing policies.
  • Colleague awareness: We are committed to maintaining high levels of colleague awareness through training and education of all colleagues and contractors. Our aim is to ensure all colleagues understand and respond to any identified slavery and human trafficking risks at all times.

6. Sharia compliance statement

The Bank operates within Sharia principles and all colleagues (*) are to be vigilant in their practices to ensure that all their actions do not conflict with Sharia principles and do not undermine these principles in any way.  If staff are in doubt, then they must seek guidance from their line manager or alternatively from the Head of Sharia Compliance & Product Development.  All colleagues will be responsible for reporting to their Line Manager any procedure or activities that might have an impact on the Bank’s compliance with Sharia. The Head of Sharia Compliance & Product Development will always be included in the sign-off process for new or amended products, services and associated procedural documentation. (*) Colleagues include anybody who is employed by, or carries out work on behalf of, the Bank including managers, officers, directors, contractors, consultants, trainees, part-time and fixed-term workers, temporary staff, agency workers and volunteers.

Remuneration Committee approval

This statement was approved on 30 November by the organisation's Rem Co, who review and update it annually.

Last updated 21 December 2020