Trust Matters - An Interview with Greg Medcraft, Former Director, OECD

A: As the former chair of the Australian Securities and Investments Commission, I oversaw a sharper focus on company culture in its market monitoring and investigation activities. The reason was simple: behavioural science teaches us that culture is the unwritten code of how things are done in a business, and so, it is a good predictor of poor conduct.

Behavioural science is only increasing in its strength as a tool for predicting conduct issues, and this is for two reasons. First, it requires the large datasets that are now available to us which, when combined with machine learning and predictive models of behaviour, can be used by regulators and compliance functions to detect potential misconduct before it even arises.