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Governance & Culture Reform

New York Fed

Speeches

Williams: Banking Culture: The Path Ahead

In welcoming remarks at the New York Fed's fifth conference on culture in financial services, Building Cultural Capital in the Financial Services Industry: Emerging Practices, Risks and Opportunities, President John C. Williams, discussed what can be done to improve culture in financial services.

(DATE: JUNE 4, 2019)

Stiroh: Reform of Culture in Finance from Multiple Perspectives

In remarks at the GARP Risk Convention, EVP Kevin Stiroh identified misconduct risk as a major consideration for firms and discussed culture from the perspective of boards of directors, senior management, industry groups, and the official sector. He also discussed the idea of “cultural capital,” an intangible asset that impacts what a firm produces and how it operates.

(DATE: FEBRUARY 26, 2019)

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Publications

The Economics of Why Companies Don’t Fix Their Toxic Cultures

In this Harvard Business Review article, Executive Vice President Kevin Stiroh discusses the role culture plays in corporate misconduct, and shares his perspective on why these problematic cultures persist.

(DATE: MARCH 22, 2018)

Misconduct Risk, Culture, and Supervision

In this white paper, the conceptual argument is made for why supervisors should care about a financial institution's culture and how it is supports supervisors' approach to risk management.

(DATE: DECEMBER 7, 2017)

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Events

Partnerships in Building Ethical Norms: Governance & Culture Reform in the Financial Services

The webinar highlighted two initiatives in which the New York Fed has worked with the industry to promote ethical norms: the Education and Industry Forum’s case studies, which present ethical dilemmas faced by junior employees in financial firms, and the FX Global Code, a set of principles for participants in the international foreign exchange market published in 2017.

(DATE: OCTOBER 19, 2020)

Building Cultural Capital in the Financial Services: Emerging Practices, Risks and Opportunities

This conference provided a multi-disciplinary view on persistent misconduct in the financial industry and highlighted the effects of societal changes and new technologies on culture within firms.

(DATE: JUNE 4, 2019)

Reforming Culture and Behavior in the Financial Services Industry: Progress and Challenges

Reforming Culture and Behavior in the Financial Services Industry: Progress, Challenges, and the Next Generation of Leaders

(DATE: JUNE 18, 2018)

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Other Resources

Speeches

Woolard: Opening Up and Speaking Out: Diversity in Financial Services and The Challenge to be Met

Woolard suggests that how a firm approaches diversity and inclusion tells us a lot about its culture. However, while things are moving in the right direction, progress has been slow.

(DATE: DECEMBER 19, 2018 | SOURCE: FINANCIAL CONDUCT AUTHORITY)

Clayton: Observations on Culture at Financial Institutions and the SEC

In a speech at Reforming Culture and Behavior in the Financial Services Industry: Progress, Challenges, and the Next Generation of Leaders, Jay Clayton, SEC Chairman, spoke on the importance of developing, improving and reinforcing positive culture in financial institutions.

(DATE: JUNE 18, 2018 | SOURCE: U.S. SECURITIES AND EXCHANGE COMMISSION)

Byres: The Incentive to Fly Safely

In his regulatory address at the AFR Banking & Wealth Summit in Sydney, Wayne Byres, APRA Chairman, focused on incentives and accountability in the financial sector.

(DATE: APRIL 4, 2018 | SOURCE: AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY)

Bailey: Transforming Culture in Financial Services

In a speech in London, Andrew Bailey, Chief Executive, Financial Conduct Authority, focused his remarks on understanding the drivers of poor conduct, developments of recent years, and the importance of good diversity in the workplace.

(DATE: MARCH 19, 2018 | SOURCE: FINANCIAL CONDUCT AUTHORITY)

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Industry Publications

Group of 30: Banking Conduct and Culture: A Permanent Mindset Change

In their latest report, the G30 focuses on two fundamental questions:

How much progress has the banking industry made in conduct and culture 10 years on from the global financial crisis; and
In what areas should banks continue to press on, and what evolving questions should they be mindful of going forward?

(DATE: November 2018 | SOURCE: Group of Thirty)

FMSB publishes new financial markets misconduct research

The FICC Markets Standards Board (FMSB) published a Behavioural Cluster Analysis study that reviewed the behavioural patterns in 390 cases of misconduct over an extended period of time, covering 26 countries and multiple asset classes.

(DATE: JULY 2018 | SOURCE: FMSB)

U.K. Banking Standards Board: 2017/2018 Annual Review

The Banking Standards Board (BSB) published its 2017/2018 Annual Review, which is a result of the largest ever survey of behavior, competence and culture in U.K. banking. The report paints a picture of the banking sector based on the views of more than 36,000 people working in 25 banks and building societies and gives an overview of the BSB's work over the past 12 months.

(Date: March 2018 | Source: Banking Standards Board)

U.K. Banking Standard Board: Annual Review 2016/2017

The Banking Standards Board (BSB) annual review paints a picture of the banking sector based on the views of more than 28,000 people working in banks and building societies across the U.K. The BSB welcomed the engagement of a diverse range of firms, all keen to learn more about managing their own organizational culture.

(DATE: MARCH 2017 | SOURCE: BANKING STANDARDS BOARD)

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OFFICIAL SECTOR PUBLICATIONS

Bank of England Working Paper on Organizational Culture and Bank Risk

The Bank of England released this working paper linking indicators of poor culture to higher risk outcomes.

(DATE: MARCH 2021 | SOURCE: BANK OF ENGLAND)

Australian Prudential Regulation Authority: Information Paper Outlining GCRA Approach

The Australian Prudential Regulation Authority (APRA) shared its plans to scale up significantly its efforts to lift standards of governance, culture, remuneration and accountability (GCRA) across the industries it regulates.

(DATE: NOVEMBER 2019 | SOURCE: AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY)

Australian Prudential Regulation Authority: Final Report on Inquiry into the CBA

The Australian Prudential Regulation Authority (APRA) released the Final Report of the Prudential Inquiry into the Commonwealth Bank of Australia (CBA).

(DATE: MAY 2018 | SOURCE: AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY)

Financial Conduct Authority: Transforming Culture in Financial Services Discussion Paper

The FCA published a discussion paper that includes a set of essays that discuss what a good culture might look like, the role of regulation and regulators, how firms might go beyond incentives, and how to change behaviour for the better.

(DATE: MARCH 12, 2018 | SOURCE: FINANCIAL CONDUCT AUTHORITY)

Financial Stability Board: Stocktake of Efforts to Strengthen Governance Frameworks

The Financial Stability Board (FSB) published a report on efforts being undertaken by international bodies, national regulators, industry associations and firms on developing the use of governance frameworks to address misconduct risk.

(DATE: MAY 2017 | SOURCE: FINANCIAL STABILITY BOARD)

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Governance & Culture Reform

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Culture Web Series: Partnerships in Building Ethical Norms

Hennessy: Shelter from the Storm: Psychological Safety and Workplace Culture during the Coronavirus Pandemic

Stiroh: The Impact of the Pandemic on Cultural Capital in the Finance Industry

Full Resource List