An Interview with Susan Axelrod

A: Candidly, I think one of the organizations that helped ignite a lot of conversation around culture was the NY Federal Reserve Bank (FRB), under Bill Dudley. The culture conference that the NY FRB started included senior representatives from large financial institutions and members of their Boards, all being invited to speak and to lead on the topic of culture and how it effects conduct at a firm. From a broker-dealer perspective, at FINRA, we started to examine the ties between culture and conduct, and we thought that sitting down with a number of large firms to ignite the conversation was consistent with FINRA’s mission.

Since there are reporting requirements for certain disciplinary actions and terminations, FINRA can monitor, on an industry-wide basis, the level of conduct that was violative of firm policy, SRO rules and federal securities laws. Having that unique lens, we determined that understanding the tone, perspective and sense of accountability around the issue of culture would help us to identify conduct-related weaknesses which could potentially have an impact on the investing public.