PwC said the survey suggested financial institutions are not taking a leadership position on risk management issues. Over half the survey respondents said pressure for improved governance came from investors and regulators rather than from their own management. The survey also showed that financial institutions remain wary of disclosing more than they are required to, with most internally available information not being revealed to investors.
PwC also investigated support for a move to global accounting standards, and found two thirds of European respondents and over a half of Asian respondents believed global standards would materially increase public trust in financial institutions. But only one third of US respondents believed such standards would have a significant effect. PwC recommended that the industry should lend its support to moves by regulators to formulate consistent international accounting principles.
“We are not suggesting that the financial services industry is responsible for changing general standards of disclosure, but as reporters of corporate information and as major investors in companies that disclose results, they can certainly be vocal advocates and practitioners,” said Ian Dilks, a London-based partner at PwC.
PwC surveyed senior executives from 42 institutions on what they are doing to improve their own standards of disclosure and governance. They also held over 30 one-to-one interviews with fund managers, investment associations, equity analysts, rating agencies, international financial institutions, bankers and insurers in the US, Europe and Asia.