On Thursday, 26th November Jonathan Davidson, The FCA's Executive Director of Supervision - Retail and Authorisations, highlighted the challenges around D&I and Climate Change in his speech on "The business of social purpose" at the FCA's 6th Annual Culture and Conduct Forum for the Financial Services Industry.
Jonathan's speech follows the Financial Conduct Authority's warning to firms earlier in the year that failure to support a good business culture can result in "increased supervisory scrutiny" from the regulator.
The watchdog then committed to ensuring the "transformation" of culture in the financial services sector remained a priority for the FCA. The regulator published a series of industry papers on its website, heralding the start of a "much larger conversation" surrounding "purposeful cultures" within the financial services sector.
Key takeaways from Jonathan's speech:
- Culture remains a key area of focus for the FCA.
- During the coronavirus (Covid-19) crisis, financial services firms have supported consumers, and been part of the solution rather than the problem, providing an opportunity to rebuild trust in financial services moving forwards.
- While coronavirus might be the most immediate challenge firms are facing, it isn’t the only one – the need to break barriers around diversity and inclusion, climate change and sustainability are key challenges that also require urgent attention.
- Firms with healthy cultures – cultures that are purposeful, safe, and support environments that are diverse and inclusive – will be better placed to tackle these challenges.
- The financial services industry has the opportunity to make real progress, driven by social purpose.
The FCA's emphasis on the importance of D&I should cause regulated firms to review their own D&I policy and establish if it aligns with the FCA's direction. Diversity and inclusion is a multi-faceted issue that requires serious thought and attention.
A few months ago, FourthLine Director Dan Waltham sat down with Sonya Barlow, founder of the LMF Network, a non-for-profit network that aims to change the current narrative around inclusion and tackle the lack of diversity within the workplace.
In the Q&A we looked at how unconscious bias disproportionately affects groups within the workplace, whether that is through racial, gender or sexuality. Sonya highlights that "although unconscious bias is within us, we as colleagues or hiring managers need to be conscious of the stereotypes we place upon groups and how that can influence are behaviour towards others and most importantly, how these biases can affect our hiring decisions".
You can watch the full diversity and inclusion interview with Sonya here>
If you are looking to strengthen your own D&I function and need a sounding board, feel free to book a short meeting with Daniel Waltham, our Director of Talent here>