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
In this chapter, we approach conduct risk from a slightly different angle, considering it from a philosophical and anthropological standpoint. We look at corporate beliefs and how they manifest in different corporate environments and then give a guide to tools and techniques that could be used to evolve and adjust them accordingly.
We develop this thinking further still by detailing the links between beliefs and corporate strategy and between product development and corporate frameworks. Finally, we reflect on how an organisation might evidence effective implementation and demonstrate success in managing and mitigating conduct risk.
Before we get into the details of these views let us take a moment to reflect on this from the regulatory perspective. Conduct-of-business regulations exist to provide firms with core principles with which to undertake “regulated business”.
However, there has been a move away from the previous tick-box approach to a more flexible style of regulation as promoted in Europe under the Markets in Financial Instruments Directive (Directive 2004/39/EC) and the work of the former UK regulator (Financial Services Authority). This, in our view, therefore