An Overview of Conduct Risk
How Does Conduct Risk Manifest and What Are Its Root Causes?
What Are the Driving Forces of and Who Owns Conduct Risk?
Scope and Ownership within the Business
Conduct Risk in Financial Services: Lessons from the Hospitality and Leisure Industry
Ethical Culture: What, Why and How?
Language and Conduct Risk: Limited Language – Big Blind Spots
An Anthropological Perspective on Conduct Risk
Identifying and Measuring Conduct Risk
Risk Appetite Setting and Modelling Conduct Risk
The Effect of Conduct Risk Losses on Reputation
Bringing the Customer Back to the Foreground: The End of Conduct Risk?
Managing Conduct Risk
Closing Comments on the Future of Conduct Risk
Throughout my lectures and attendance at numerous risk seminars since the crisis, one theme has persisted: the financial services industry may have many lessons to learn from other sectors when it comes to conduct risk.
This theme was reiterated in a speech at the Financial Conduct Authority (FCA)’s Enforcement Conference in 2014, where Tracey McDermott stated (in light of the foreign exchange (FX) market manipulation):
Faced with this misconduct, which is so similar to that of the recent past, people can say that lessons are not being learned. And there have been all too many examples – in both the retail and wholesale space – to reinforce that view.
These repeated failures undermine the reputations of both the regulated and regulator. In this, we are actually all in it together. But more important than our reputations is the reputation of the financial services industry as a whole.
She went on to say:
We cannot rewrite the past but we can chart a different future. We will not, however, do that if we forget the past. The challenge, as Lyndon Johnson said, is that we must “learn lessons from the past but we can’t live in it”.
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