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In a speech at the Mansion House the FCA’s Chief Executive, Martin Wheatley, highlighted the way in which the regulator is driving cultural change within the financial services industry. In a speech which echoed and reinforced the messages which have already issued from the FCA Mr Wheatley said that “For leaders today – both in business and regulation – the dominant theme of 21st century financial services is fast turning out to be a complicated question of fairness.”
Expanding on this theme Mr Wheatley said that central to the fairness debate are culture and accountability. In pursuit of this the FCA wants to move forward to a time when firms will do the right thing whether or not the regulator is watching and in which senior management are accountable for doing the right thing.
Partly laying the blame for previous failures on the tendency to stamp out wrongdoing by laying on further regulation, Martin Wheatley highlighted the fact that in the time in which many of the current scandals originated the FSA guidance actually expanded by some 27%. Quoting from Roger Steer’s book Ethicability in which Steer says that “At their worst, rules, laws, regulations and red tape have a tendency to multiply because they remove our responsibility for deciding what’s right,” he echoed the call within the book for “a more sophisticated interpretation of integrity in business – one that is not simply defined by the ethics of obedience – so what is legally right or wrong – but actually looks towards the ethics of care and the ethics of reason.”