FCA kicks off culture transformation debate in financial services

The Financial Conduct Authority (FCA) has published a discussion paper, which it hopes will stimulate debate on transforming the culture of financial services.


The paper features 28 essays from academics, industry leaders and international regulators, looking at 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.

Joe Garner and Paul Pester chief executive at Nationwide and TSB, respectively have contributed, as well as Alison Cottrell, chief executive of the Banking Standards Board, Tom Blomfield, chief executive at Monzo Bank and Peter Cartwright, Professor of consumer protection law.

The FCA wants those with an interest in financial services to consider the issues in the paper and to debate what constitutes a healthy culture, and how to promote it.

The essays are grouped under four themes: Is there a ‘right’ culture?; managing culture – the role of regulation; the role of reward, capabilities, and environment in driving behaviours; and leading culture change.

The FCA today said culture and governance is its priority.

The previous introduction of the Senior Managers and Certification Regime (SM&CR) created a formal link between the behaviour of individuals and the conduct of the firm.

Jonathan Davidson, FCA executive director of supervision- retail and authorisations, said: “Culture may not be easily measurable but it is manageable.

“So firms can and should take responsibility for ensuring their culture is healthy for both their employees and customers, which can complement and support their business strategy.

“We as a regulator have long gone beyond having the mindset that simply complying with rules is enough.

“However we don’t believe a one size fits all culture is the right way to go.

“So we want to promote a discussion and consensus on the essential features of a healthy culture and how firms, regulators, employees and customers can help deliver that culture.”

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