The Chief Executive of the FCA has issued a number of statements recently which all hang, more or less, on his mansion house speech last October, so it is worth noting some of his comments.
- ‘Many people think that we have now entered a compensation culture where it is easier to pursue an easy pay-out via a claims company rather than accept that you made a mistake in the first place. Compensation should only be paid when it is fair to do so’.
- ‘Much of the criticism of the regulator in the past has been around the frustrations of retrospective action versus early warning. Talking to people rather than listening to people.
- If you want to predict how people will behave, look at their incentives’.
- ‘Everyone ticks the box, no one reads the terms and conditions.’
- ‘The regulatory system will place more emphasis on good judgement and less on narrow compliance with a set of rules. The ‘ethic of care’ – doing what is right, takes precedence over the ‘the ethic of obedient’ – doing what is allowed.’
- ‘There will be far more emphasis on the culture of a firm, at every level and at every stage.’
It seems that Wheatley is more connected to the real world than any of his predecessors, which gives cause for cautious optimism that regulation will become less of an inhibitor to the delivery of quality financial services to the public. The two key words are ‘culture’ and ‘fair’. Firms should at all times be able to demonstrate that a culture of fairness is firmly embedded in the business.
The above is the lead article in our monthly News Notes. Please click here for information regarding these notes.