Wendy van Tol & Olivier Sueur - Good Market Conduct

826 views

Published on

  • Be the first to comment

  • Be the first to like this

Wendy van Tol & Olivier Sueur - Good Market Conduct

  1. 1. Good Market ConductRecovery of financial services; based onregulations or values?Presentation for CCTConference 2012September 2012
  2. 2. 1 March 2011 2
  3. 3. Why focus on „treating customers fairly‟ and on„improving corporate culture‟?“Governments and regulators don‟t understand how a bank works,they don‟t want to, so they come up with stupid legislations. But wehave no choice, we must comply” – Chief Risk Officer bank“We‟re working very seriously on culture, but as regulators are onlyinterested in the evidence, we‟ re putting the words „treating customersfairly‟ and „cultural change‟ more often in the minutes of our boardmeetings.” – CEO bank“It‟s a shame that TCF has become a priority of regulators; it‟s ourreason for being, it should be at the heart of our business” – numerousBoard Members From interviews held in September 2012 3
  4. 4. Signs of frustration and confusion“We put huge efforts in changing our complete way of workingbecause that‟s what we want, but the constant public bashing is veryfrustrating.” – CEO insurance company“More regulation doesn‟t bring about a greater sense of responsibilityand more creativity, on the contrary” – Supervisory Board memberinsurance company“I would never work at this bank – too complex, too many proceduresand this bank has no friends” – Supervisory Board member bank From interviews held in September 2012 4
  5. 5. Other industries 5
  6. 6. Complexity of financial services industry• Conflicting roles: public utility vs. private company• Different feedback loop• Complexity & intangibility of products• Raw material = reward 6
  7. 7. Good market conduct - VisionSuccessful enterprises derive their raison d‟etre from simultaneouslymeeting the needs of all their stakeholders: clients, employees, investors,business partners and the society at large.The achievement of the organization’s short-term goals is aligned with thelong-term needs of its stakeholders.The strategy of these enterprises is aimed at actively aligning the values,interests and expectations of its stakeholders with those of theorganization itself.The leaders of these enterprises display these tenets both in words andactions.Good market conduct-companies give account to all their stakeholders in anintegrated manner. Barrett Values Centre – 2012 International Conference 7
  8. 8. PwC‟s Good Market Conduct approach Integrated reporting ACCOUNTABILITY Management control CONTROL Design & Operate EXECUTION adequate processes LEADERSHIP Walk the talk STAKEHOLDERS VALUES Setting strategic objectives Interaction with stakeholdersBarrett Values Centre – 2012 International Conference 8
  9. 9. ExerciseDebate about restoring trustLet’s divide the group into two subgroups: A “Restoring trust based on regulation” B “Restoring trust based on values” You will have 10 minutes with your subgroup to prepare the debate. Good luck! Round 1 Stand your ground Team A will have one minute to defend their statement Team B will have one minute to defend their statement Round 2 Time to react Team A will have max. one minute to ask only questions Team B will have max. one minute to ask only questions 3 minutes for group consultation Round 3: Closing speech Team A will have two minutes for their closing speech Team B will have two minutes for their closing speech Barrett Values Centre – 2012 International Conference
  10. 10. Hand-out – Team ATeam A “Restoring trust based on regulation” You will have 10 minutes with your subgroup to prepare the debate. Good luck! Round 1 Stand your ground Team A will have one minute to defend their statement Team B will have one minute to defend their statement Round 2 Time to react Team A will have max. one minute to ask only questions Team B will have max. one minute to ask only questions 3 minutes for group consultation Round 3: Closing speech Team A will have two minutes for their closing speech Team B will have two minutes for their closing speech Arguments to support your statement: • Regulation is the only way to embed compliant behavior in an organisation • Trust is good, control is better • Employees need limits and boundaries to work effectively Please feel free to put these arguments aside and come up with your own. Barrett Values Centre – 2012 International Conference
  11. 11. Hand-out – Team BTeam B “Restoring trust based on values” You will have 10 minutes with your subgroup to prepare the debate. Good luck! Round 1 Stand your ground Team A will have one minute to defend their statement Team B will have one minute to defend their statement Round 2 Time to react Team A will have max. one minute to ask only questions Team B will have max. one minute to ask only questions 3 minutes for group consultation Round 3: Closing speech Team A will have two minutes for their closing speech Team B will have two minutes for their closing speech Arguments to support your statement: • It is not possible to write a rule to control every possible behavior or cover every possible circumstance • Regulation is killing for motivation, autonomy, creativity and innovation of people • Values give people a sense of mission and purpose Please feel free to put these arguments aside and come up with your own. Barrett Values Centre – 2012 International Conference
  12. 12. We think …It is time to put good market conduct on each board agendaBy linking values and stakeholders expectations (including rules andregulations) with the strategyAnd translate that into a sustainable connection between the products,services and clientsTo be transparent and clear about what the strategy means for theorganisation and how it drives the right behaviour of management andemployeesTo execute on it and make it true by linking it to governance, performancemanagement systems and internal controls.And finally, to be transparent about it to realize confident, informed andempowered stakeholders.
  13. 13. PwC ContactsWendy van TolPwCTel: +31 (0)88 792 7606 | Mobile: +31 (0)6 2353 4450E-mail: wendy.van.tol@nl.pwc.comOlivier SueurPwCTel: +31 (0)88 792 4920 | Mobile: +31 (0)6 1058 0264E-mail: olivier.sueur@nl.pwc.com 13

×