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A strong ethical culture is considered essential to make banks less prone to misconduct. Financial regulators and industry bodies have launched several initiatives to reduce the risk of further misconduct, by launching culture reform initiatives and improving accountability and controls.
Vigeo Eiris research shows that a minority of the global banks has taken concrete steps to support, promote and communicate a responsible business culture:
- Almost three quarters of banks in our sample report to integrate CSR risks in their internal controls, but less than 40% have strong processes in place to manage those risks
- While three quarters of banks identified staff considered as ‘material risks takers’, only one fifth introduce conduct related performance metrics within their remuneration policies
- Only one third of banks instituted formal training programs on the prevention of business ethics risks and clearly support an internal culture of responsible business conduct.