Corporate culture, explains the Financial Stability Board (FSB), is an important determinant for the occurrence of misconduct. A 2017 Thomson Reuters survey finds that this sentiment is echoed by the industry, where almost half of surveyed firms, “consider culture and conduct risk to be intrinsically linked, with culture as a critical factor in managing conduct risk.”1
As with the term “culture,” there is no consensus definition of “conduct risk.” The FSB notes that there is “neither a homogeneous definition nor a predetermined taxonomy.”2In the Thomson Reuters survey, only 21% of firms were found to have a working definition of conduct risk.
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