In the years since the financial crisis, culture in banking has risen up the agenda – for the media, the public, shareholders, regulators and for the banks themselves. There is widespread consensus that a cultural shift was and is necessary, and with external pressure for reform, in addition to self-imposed imperatives, banks of all shapes and sizes have made culture a key strategic priority.
Whilst many of the changes banks have implemented to date have been challenging, the more difficult task of embedding good culture in all parts of the organisation will require the resolution of some tough dilemmas that will likely require changes to the businessand operating model.
In a recent survey of senior banking executives we found that regardless of a bank’s individual circumstances post the financial crisis they were all on a cultural journey. This journey, for all banks, comprised of three distinct phrases that are explained in the video below:
The regulatory framework of the past years has hugely influenced banking culture. The introduction of the Senior Managers Regime will enhance individual responsibility. The implementation however, could prove to be challenging with the inherently collaborative nature and matrix model in many banking institutions.
A recent survey showed that 70% of industry managers believe the new regime will drive greater accountability and improve the industry standards.
Frontiers in Finance highlights challenges and opportunities to enhance bank governance through the...