In Regulatory Wrap for the week to March 14, 2025:
In this week’s Regulatory Wrap, we examine a speech from the Financial Conduct Authority’s (FCA) Chief Operating Officer, Emily Shepperd, which highlights the impact culture has on risk management.
Regulatory Wrap episode 55: Catching the culture bug
In Regulatory Wrap for the week to March 14, Rob Mason reviews an FCA speech on culture's ability to spread within an organization.
Regulatory Compliance
Video
Highlights:
1. Shepperd emphasized how contagious culture can be, stating that it “moves quickly from person to person,” whether good or bad
2. Conduct and culture go hand in hand, as culture is what drives decisions and actions at every level of an organization
3. Last year, the FCA distributed a survey to over a thousand firms asking for information on the number and type of reported instances of non-financial misconduct from 2021 to 2023
4. In January, the FCA issued a “Dear CEO” letter to brokers to clarify regulatory expectations, which required that firms have controls in place to detect misconduct and take adequate measures against those involved in misconduct
5. The FCA stated that firms should be using “the usual detective and monitoring controls,” particularly naming trade and communications surveillance
This episode is brought to you by our Director of Regulatory Intelligence, Rob Mason.
Like Shepperd states in her speech, culture is contagious, and to avoid an “unhealthy” work environment, firms should ensure they’re effectively monitoring communications to catch and remedy bad behavior before it spreads.
