It seems that the “culture wars” continue spreading, and have now reached the corporate regulator, ASIC, itself.
Remember, we are dealing with culture as being the values and norms that an organisation holds and which drives much behaviour, not culture as in music, statues and paintings.
Before continuing, let me wind back a few months.
Then many of the banks were in the firing line for a “poor culture” when it came to dealing with problems in their financial planning divisions. The Commonwealth Bank was especially affected because of delays in dealing with problems of poor financial planning advice and consequent losses by clients, while its life insurance arm, Colonial, was under fire for dodgy policies.
ASIC was quick to criticise the banks involved, and tell them they needed to improve their culture. The Prime Minister, Malcolm Turnbull has arranged for bank CEO’s to front a parliamentary committee annually, on the basis that this will “concentrate their minds and drive improved culture.”
Maybe, but now it emerges that ASIC has its own culture problems. As reported in the Financial Review. It is being sued by one of its own internal lawyers, claiming anxiety and depression, alleging that the senior executives gave him a bad performance rating and put pressure on him to give a bad rating to his team members.
Oh dear. Stones, glass houses etc.
Culture is terribly important in financial markets and advice. Law and regulation can only go so far, and no matter how much regulation there is, problems will keep arising if there is not the right ethical culture.
However, once the right culture goes missing, it can be hard to get back. It needs more than just talk.
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