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exorbitant pay policies”(The Telegraph, 2017). 13. Disaster Risk Barclays’ position as a multinational company leaves it vulnerable to risks associated with climate change and environmental legislation. Barclays has operations in countries such as Brazil and Japan, which frequently experience natural disasters (United Nations University, 2016). As well as causing non-compliance, a natural disaster which damages its property could devastate Barclays’ long term plans, therefore, banks have recently been advised to consider this risk (Climate Home, 2016). Barclays had a four-year commitment from 2011 to 2015 which contained goals to collaborate with “stakeholders to minimise the risk to [its] own operations, as well as to [its] customers and clients”(Barclays Bank PLC, 2015). Additionally, Barclays continually reviews and improves its environmental risk management systems (Barclays Bank PLC, 2015). 144No14. Small Losses Due to Human Error Barclays has previously faced minor financial losses due to human error. For instance, in 2005, an error was made in the payroll system which caused 62,000 UK staff to be paid late (Personnel Today, 2005). The No controls noted. 1 3 3 No
SRN:1064529 bank was forced to reimburse some employees who suffered financial detriment due to the error. This is an infrequent occurrence. Opportunities for Barclays (Positive Risks) Risk Number Risk Description How Barclays Can Benefit 1. Donald Trump Election Many analysts expect the election of Donald Trump as president of the United States to be positive for banks (Financial Times, 2016). Donald Trump has pledged to cut the corporate income-tax rate from 35 percent to 15 percent, and to also slash individual rates in an attempt to grow the US economy (Bloomberg, 2017). In the short term, Donald Trump’s election is boosting the share price of banks in the US (Financial Times, 2016). In the long term, Barclays in the US, especially its investment banking division, as it will likely receive higher returns from bonds as investors purchase risky (junk) bonds aggressively due to confidence that Trump’s new policies will provide a high return (Financial Times, 2017). In addition, it will benefit from having to pay lower taxes (Bloomberg, 2017). 2. BrexitAccording to Barclays’ current CEO Jes Staley, Barclays’ US operations have natural hedge against Brexit (Financial Times, 2016). Despite the predicted negative implications for the City of London, Barclays predicts that New York “will be stronger”(Financial Times, 2016). It has been predicted by City of London Corporation Chairman Mark Boleat that a third of jobs lost in the City of London could move to New York, a benefit which would offset the disruption to Barclays in the UK (CNBC, 2016).
SRN:1064529 Bibliography Ashurst, 2016. Brexit: the potential impact on the UK’s banking industry. [Online] Available at: [Accessed 28 February 2017].