the evidence of psychology suggests that the “ system ” and “ situation ” are far more likely to predict actual ethical behaviour compared to personal convictions. this is somewhat comforting, because it means that a huge part of the ethical challenge can be addressed without the need to reform people from within. the problem of “ bad apples ”, it seems, can be largely solved by focusing on cleaning up the “ bad barrels ”. however, the element of “ people ” remains relevant in determining behavioural outcomes – even if to a lesser extent. again, this is a very wide and complex subject, but i wish to briefly mention two key points. first – we must remember that the financial sector, like human society, is made up of moral creatures. we cannot live, much less flourish, unless we recognise this and begin to employ the language of ethics in business. the language of business must align with what most people feel about how to live well : be honest ; give trust ; create lasting values ; be reliable ; and take pride in your work. the evidence reveals that employees are much more productive, and feel more fulfilled, when they believe that they share the same values as the organisation they work for. my point is simple – we must not shy away from the language of morality and objectivity in finance. yes, there are many ambiguous areas. but some things are right, and some things are wrong ; and as moral creatures, we should engage on these terms, even in business. morality does not 4 / 5 bis central bankers'speeches cease to exist when we go to work. if dishonesty is unacceptable, then it is unacceptable regardless of whether we are dealing with a neighbour or with a counterparty. the global financial crisis has been a sobering reminder of why we must not divorce ethics from finance. second – we must all face up to the difficult but necessary decisions of keeping out bad apples from the financial industry. recruitment and promotion plays a key role here. organisations should pay careful attention to the individuals they hire and promote. recruitment assessments should be done with utmost vigilance, and financial firms must be more candid in dealing with cases of misconduct. complaints and suspicions should be investigated properly, with an opportunity for the individual in question to make representations. if their name is cleared, then this should be recorded, to protect them against unfounded accusations in the future. if they are found to be in the wrong, then proportionate disciplinary action should be taken and recorded. often, bad apples

, it is not only in the epc ’ s own interests that it stays at the centre of european retail payments integration and innovation ; it is also in the interests of the market. it is clear that the epc should continue contributing to sepa council work, as a representative of the european banking sector for retail payments. the involvement would be at the strategic level and often also at the requirements level. in addition, as scheme owner of sct and sdd, the epc has a continued responsibility for maintenance and improvements. it should do that in a transparent way, as is being done with the customer stakeholder forum, the clearing & settlement forum, and with the consultations on new releases. perhaps the epc should review its involvement in cards, where it is not a scheme owner. the sepa cards framework and its subsequent q & as have not proved to be very effective in developing a european card payments market. the work of the cards stakeholders group on the standardisation of functional requirements and the standardisation of the security requirements for cards and terminals should become the leading workstream. the epc ’ s role would then be to channel the positions of the european banking sector at the strategic level of the sepa council, as well as to provide technical expertise in the discussions of the cards stakeholders group. it is a good example of how social dialogue and multistakeholder involvement can work. for innovative payments, such as internet and m - payments, the epc has a legitimate role to enable the use of the epc ’ s own schemes. it could do so by developing implementation guidelines for sct and sdd for use in such payments. it is important that this is done in a way that involves other stakeholders, also those outside the traditional banking sector. conclusions let me conclude. the work on payment systems and on sepa in particular remains a crucial part of european integration in the area of financial services. sepa is delivering value to all european citizens. for banks, before and during the financial crisis, the provision of retail payments is one of their few stable business lines and an area on which many banks are focusing. the internet, in an embryonic form, started 43 years ago today. young people today are unaware how our economy, our society and the world functioned before the internet, and especially before the world wide web. how do you think they perceive the fact that the institutions to which they entrust most of their money and on which they rely to make most of