by Dina Medland in London
Regulation: No ‘race to the bottom’
The uncertainty around Brexit has resulted in heightened media scrutiny of contrasting comments about what might happen to regulation in order to keep Britain “competitive.”
But in a speech delivered at the Association for Financial Markets in Europe (AFME) Annual Conference earlier this week, Charles Randell, Chair of the Financial Conduct Authority, said: “The FCA does not see the UK’s withdrawal from the European Union as an opportunity to join a race to the bottom in regulatory standards – quite the contrary. We will need to redouble our engagement with our policymaking and regulatory colleagues in Europe and across the world, to continue to influence global standards of financial regulation… Strong global standards also reinforce the competitiveness of the UK financial services sector.”
“This is most definitely not a zero-sum game” Mr Randell continued. As we await the results of the Kingman Review into the future of the audit regulator and corporate governance watchdog the Financial Reporting Council (FRC), there have been many meetings behind closed doors on the complications of dominance, control and inter-connectivity in that market.
The Financial Times continues its excellent series on the nature of audit with a report yesterday of a private meeting held last week at the ICAEW that was attended by senior figures from the 100 Group, which represents the views of FTSE 100 finance directors. The FT story begins: “The chief financial officers of the UK’s largest companies have raised concerns about proposals put forward by politicians and regulators to shake up the audit market and eradicate conflicts of interest.”
UK media coverage of governance issues includes the £16.4 million fine levied this week on Tesco’s financial services business by the FCA for security failings leaving account holders vulnerable to a cyberattack in 2016, the largest ever cyber security breach at a UK bank.
“Cyber security requires resilience. A financial institution’s board is ultimately responsible for ensuring that its cybercrime controls are designed to meet standards of resilience” said the FCA in its press release, and the Final Notice to Tesco Personal Finance plc is here.
Diversity and Gender
There is a lot of dragging of feet when it comes to the progression of women in business, despite all the talk of action, not words. It is undeniable that this is partly because of deep-rooted bias, and entrenched ways of thinking. A new report on women in business by Thomas International, people assessment specialists, should be required reading for the FTSE 350.
Its research has found that women are as likely as men to have the traits of a good business leader, but they face additional hurdles to their success in that the very traits that are proven predictors of leadership potential are judged negatively when they are shown by women. “There is an inherent bias in the way people describe female success, and it’s holding women back,” says Jayson Darby, Head of Psychology and author of the report.
“If companies want to really solve the diversity problem in the boardroom, and have great women reach the top of their organisations, they need to start evaluating them impartially – that means using psychometric assessments - rather than allowing this ‘gender jaundice’ to prevail” he adds. It’s certainly worth thinking about.