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Half of the European Investment Bank's staff fear retaliation if they speak out about wrongdoing, according to the first survey of the bank's whistleblower system, the world's largest multilateral lender.
The findings reflect widespread and long-standing concerns expressed to the Financial Times by more than a dozen current and former employees about the culture at the Luxembourg-based EU bank, whose former president, Werner Hoyer, is under investigation for alleged corruption and misuse of funds.
An internal survey of the bank conducted in 2023 found that 50% of employees feared “retaliation” if they reported misconduct, including allegations of bullying, harassment or fraud. Only 14% were satisfied with the results of speaking up about such misconduct, according to a leaked presentation obtained by the Financial Times.
The findings come at a critical time for the reclusive institution that Hoyer once described as “growing more or less in secret in the woods of Luxembourg.” EU member states are under pressure to fund the bloc's ambitious greening and defense needs and are increasingly looking to the EIB and its 550 billion euro balance sheet to meet their demands.
EIB officials told the Financial Times that a lack of oversight and a perception that the bank's top appointments were politicized had created a culture of favoritism and a non-transparent recruitment process.
“Many staff are afraid to speak up, fear retaliation and do not trust that corrective action will be taken,” said an EIB staff representative's commentary attached to the survey findings.
A separate presentation from the same survey, obtained through a freedom of information request, found that only 40% of respondents believed banks would protect employees who reported issues in good faith and take their concerns seriously.
Previous EIB staff surveys have shown consistently low satisfaction with the bank's ethical standards: In 2019, only 30% of staff surveyed said the bank received high marks for professionalism, ethics and integrity. In 2022, this proportion increased slightly to 35%.
The bank has a whistleblower protection policy, but several current and former employees told the Financial Times they received no assurances from the bank that they would be protected if they reported concerns in good faith. One employee described the policy as “dysfunctional.”
The EIB said its findings showed a “high awareness” of the code of conduct and a “willingness to come forward to testify to observed cases”, but also highlighted “room for further improvement”, such as confidence in whistle-blower protection.
The bank said the results were “comparable” to those of other international institutions, adding that the bank was implementing “a series of measures to further improve the situation.”
Recommendation
The EIB's new president, Nadia Calvino, a former Spanish finance minister, has pledged to revitalize the bank and build better relationships with staff to push the bank toward a more ambitious lending policy.
In an internal memo to staff seen by the Financial Times, Calvino said the initiation of an internal management action plan, including the appointment of an independent ombudsman, would encourage “early action to avoid escalation of disputes, stronger procedures to deal with harassment and greater availability of information to whistleblowers and aggrieved parties.”
But former officials question the bank's ability to turn things around unless the ombudsman is truly independent from EIB management.
“The staff have been left with a kind of trauma over the past 12 years that can't be healed by just putting a grade on a piece of paper,” said another former employee.
The bank said the ombudsman would be an “independent body” similar to those of other institutions such as the European Commission and the European Central Bank. Details of the ombudsman's powers were “still under consideration”.
Mr Hoyer, who served as the bank's president from 2012 to 2023, and a former spokesman for the head of EIB staff are both under investigation by the European Public Prosecutor's Office for alleged corruption and misuse of funds.
The investigation is focusing on more than 1 million euros paid by the bank to employees, according to two sources familiar with the investigation.
Both men deny any wrongdoing. Mr Hoyer's lawyers said: “The allegations of corruption, abuse of power and misappropriation of EU funds against Dr Hoyer are completely unfounded and without merit.”
Additional reporting by Javier Espinosa and Laura Dubois in Brussels
