Conduct Risk: It's Not What You Do, It's WHY You Do It

Conduct Risk: It's Not What You Do, It's WHY You Do It

by Lee Werrell


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The aftermath of the financial disaster of 2008 sparked significant adjustments to the approach taken toward financial services regulation all over the world. Even though the immediate priorities involved stabilising and repairing firms' balance sheets and implementing liquidity and capital reforms, the regulators' attention and resources are currently centred around the behaviour of firms and exactly how they conduct their business.

Although managing risks has accelerated, mitigating conduct risk has become one of the highest priorities for regulators worldwide, a universally agreed concise explanation conduct risk does not, as yet, exist.

Perhaps Conduct Risk should be re-badged as "Culture Risk", as it may be better understood by all, except that culture would be even more far reaching and encompassing tradition, customs, ways of life and all these things that form the background for operations of the financial services world. Conduct Risk is what it says on the tin, concerning the conduct not only of individuals acting solely or in collusion, but also supervisors, middle and senior management and firms as a collective in the identification of customer's needs, providing real solutions, priced fairly and made available for all. Additionally firms need to be able to identify risk from products and practices that are on the regulatory radar such as forbearance in the mortgage market, product design and oversight in the asset management sector, or cross selling in full service or investment banking groups.

The true measure of a successful conduct risk framework will be the risk-based assessment of the portfolio and scenario analysis, before adapting future product, service or distribution design and customer engagement strategies, taking action in relation to issues that arise before the regulators start to take notice.

In response to changing regulatory expectations compliance and risk officers, as well as other senior managers at financial services firms are coming to terms with how to establish precisely what it means for their organisation and then to implement systems and controls to deal with the risks they have identified, including;

• Vision and Strategy
• Collaboration
• Performance Management
• Actions and Initiatives
• Issue Management
• People

This book will show you What, Why and How as well as direction and regulatory consequences in the UK if you get it wrong.

Product Details

ISBN-13: 9781505402490
Publisher: CreateSpace Publishing
Publication date: 12/05/2014
Pages: 148
Product dimensions: 6.00(w) x 9.00(h) x 0.38(d)

About the Author

Lee Werrell is a compliance professional with over 26 years' experience in the financial services industry, including roles at board and senior executive level for a bank, distribution channels including a major IFA. Lee has also advised numerous businesses on Financial Services Authority regulatory issues and developments including how to modify and adapt their strategy and procedures accordingly.

Specifically working in remedial actions and new banking applications, as well as audit and risk management, the variety and challenge of the changing regulatory landscape keeps him busy.

Author of many technical and personal development books, a simple search on Amazon or Smashwords will provide access to his material. Although the "Compliance Manager's Guidebook & Reference" EBook has been selling well, this has recently been published as a paperback and has proven to be a popular reference source for Compliance Officer's and Manager's alike.

With a range of expertise provided to FTSE 100 institutions and a variety of banks and retail operations, working with governance, risk and compliance functions and has been appointed as a skilled person by the FSA in 2012, the UK's previous regulator (now superseded by the FCA).

Lee is Chartered Fellow of the Chartered Institute for Securities & Investment (holder of the Diploma in Investment Compliance) and one of the first members of the CISI to achieve chartered status. Additionally he is a Fellow of the Institute for Sales & Marketing Management. He is also a public speaker and talks on compliance and regulatory related issues as well as Social Media within Financial Services.

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