Rebuilding public trust in the financial service industry is one of the fields of interest for those involved in managing conduct risk. FSA Managing Director Martin Wheatley expands on the need for firms to take greater focus on conduct risk.
Rebuilding public trust in the financial service industry is one of the fields of interest for those involved in managing conduct risk. The considerable scrutiny from public and regulatory firms have cast an ill light on the practices and accountability of some industry leaders – with particular focus on retail banks.
The most recent Edelman Trust Barometer has reported that only 22% of the British public surveyed said they had faith in banks and financial service sector. This is down from 45% in 2012. In the report, Eldeman found that the public’s perception was motivated by poor performance and the perception of unethical behaviour within the sector.
Ongoing coverage of poor customer service and PPI mis-handling has certainly added to the decrease of trust in the UK. However, there is hope that the new systems of regulation tthe Financial Conduct Authority (FCA) will put forth later in the year will work to improve public perception.
FSA Managing Director Martin Wheatley expanded on the need for firms to take greater focus on conduct risk, saying:
“In order to enhance trust and confidence in the integrity of financial markets, we will be willing to intervene in a greater range of client relationships and will no longer accept that there are some categories of relationship in which we have no interest.”
“To do this, our staff will have to display a new FCA way of doing things – a new culture… They will ask questions and gather data in specialist areas to try and identify the root cause of poor conduct, and will intervene earlier where they find it.” Mr. Wheatley said to the Conduct Business Unit at the Markets & Clients Assets Conference in November of last year.