Bank Culture Reform – The Wheels on Your Rollercoaster?

May 16, 2016

Bank Culture ReformAs the financial industry adapts to the changes and impacts of a regulatory rollercoaster, the sector is in need of some positive light. Financial institutions are examining their processes in an effort to efficiently and effectively ensure compliance and hopefully, obtain success.

Regulators and industry specialists are promoting a genuine shift in banking culture as an approach to overcoming the negativity and regaining trust within the broader economy. Some of the larger financial institutions are beginning to see positive outcomes from bank culture reform, resulting in increased awareness on the need to focus on culture and the repairs required to roll out that transformation.

RECOMMENDATIONS

On top of BAU activities and the pressure compiled by regulatory changes, designing and running a culture change program may seem to be a daunting task. Consultants and regulatory and industry representatives recently gathered at the Promoting & Measuring Bank Culture Reform event, and discussed the following recommendations on bank culture reform that will help to ensure your wheels are maintained for a much smoother ride.

Alignment – From the top, establish a clear understanding of the existing organizational culture and how changes will be communicated.

Benchmarking – Replicate good behaviors and look for help outside your own organization. Move beyond the financial industry to gain best practices in culture reform, for example in regards to technology.

Business Involvement – This is not just a Compliance and Human Resources initiative but should stem from senior leaders and resonate down through the businesses. Engagement from all business sides is essential for this ongoing process.

Incentives – Institute an incentive process throughout the employee lifecycle focusing on key cultural elements and instilling strong ethics and values.

Metrics – Have policies and procedures in place to prevent employee misconduct. Measurements should be consistent across silos. Although metrics are important, don’t rely solely on them to gauge progress.

Regulator Relationship – Take guidance from regulators on where gaps may be and how to address them. Regulators are actively observing and engaging with culture and have a purpose to progress the cultural reform front.

Each financial institution is unique and has to improve its own culture based on their current situation. As financial institutions continue down the track to success, the wheels will to need some maintenance and polish. This is very much an ongoing process of re-evaluating the policies and procedures in place, engaging with employees, and ensuring culture initiatives are enforced in order for a financial institution to truly reap the benefits of cultural reform.

No need to push the brakes.

Continue the journey and view additional insights from a recent Thomson Reuters event, Promoting & Measuring Bank Culture Reform.