Since the global financial crisis, there’s been a steady movement towards addressing culture in financial institutions through formal supervisory activities. This movement has been global in nature and shows no signs of abating. NY Fed President John Williams sums up the current consensus view: “Strong culture and robust corporate governance are our first lines of defense.” Over the last year, however, the tenor and scope of the attendant dialogue has shifted.
As noted in our 2018 Compendium, regulatory priorities immediately following the financial crisis were targeted at macro- and micro-prudential measures. However, despite considerable new regulation, misconduct continued to bedevil the financial sector. Having decided that restoring trust in the sector was a necessary policy priority, attention then shifted to misconduct, which was appropriately seen to have eroded trust in the industry further. Some began to posit that firm culture was the key driver of this misconduct and so, in the last few years, we have seen increasing attention to this culture-conduct nexus from bank regulators and multilateral groups, along with greater related academic inquiry and advisory offerings from consultancies and law firms.
This content is available to paid Members of Starling Insights.
If you are a Member of Starling Insights, you can sign in below to access this item.
If you are not a member, please consider joining Starling Insights to support our work and get access to our entire platform. Enjoy hundreds of articles and related content from past editions of the Compendium, special video and print reports, as well as Starling's observations and comments on current issues in culture & conduct risk management.
Join The Discussion