We are pleased to announce the launch of the third cohort of our popular and successful Conduct Risk and Culture Academies.

UK Finance workshops, webinars, and in-house seminars on regulated culture and conduct have seen strong demand from our members. However, the Academy is an intensive platform designed to provide senior managers with the detailed knowledge and practical skills needed to effect the changes in conduct risk management and culture required by a regulated firm’s board and expected by the regulator themselves. The Academy is an academically sound, pragmatic and forward-thinking opportunity for organisations to develop innovative and structured long-term strategies to embed a positive culture.

From October to December the Academy will directly address the conduct challenges faced by regulated personal and wholesale banking firms, including retail and small business banking, loans, mortgage, cards and payments, sales and trading, research, advisory, capital markets, corporate lending, private banking and asset management.

By combining industry best practice with leading-edge insight and practitioner expertise, the Academy will offer practical and effective solutions for embedding good conduct and culture in your organisation. Delegates will develop frameworks, practices and behaviours which put customers and ethical values at the heart of decision-making, exactly as the regulator has asked the industry to do.

You or your team may also be interested in The Vulnerability Academy: Improving outcomes for customers in vulnerable circumstances starting this November.

Agenda - Workshop One

WORKSHOP ONE – Enhanced Conduct and Culture frameworks to embed best practice and drive value

  • Thursday 11 October
  • 10am – 4pm – Workshop
  • 4.30pm – 6pm – Optional extras 

Workshop Outline

  • The impact of regulatory evolution: Conduct Risk, SMCR, Culture and Ethics, Reputation
  • Exploring the management challenges and value opportunities of good Conduct and Culture: thought vs instinct, integrity vs lip service, long term vs short term goals
  • Conduct frameworks that create business value and embed good behaviour: engaging the whole firm to identify and articulate behaviours to reward or crowd out

Workshop Detail

  • Evolution of latest regulatory thinking: Conduct Risk, Behaviour and Culture and what the regulators are now expecting:
    • TCF to SMCR to Culture management
    • The mechanics of regulatory failure – how Conduct depends on how we manage Conflicts of interest
    • Social licence and shareholder conflicts
  • What underpins Conduct and Culture and why is difficult to pin down and measure?
    • Absent indicators & leading indicators vs crystallisation of risk
    • Demonstrably consistent thinking and acting – impediments, incentives and instincts that drive behaviour
    • Lessons from other industries – are we all that different?
  • How does a framework help?
    • Risk appetite vs embedded values
    • Articulating risks and desired behaviours – codes of conduct and culture measures
    • A new approach to metrics – reminder of their purpose
    • Engaging the whole firm vs tick box operational, compliance and credit risk frameworks.
    • Embedding conduct to link the regulatory imperative with strategic value – reward mechanisms

Optional Extra*

  • Conduct and Culture Surgery

Agenda - Workshop Two

WORKSHOP TWO – Assessing and Managing Culture

  • Thursday 01 November
  • 10am – 4pm – Workshop
  • 4.30pm – 6pm – Optional extras 

Workshop Outline

  • Meaningful definitions of Culture and indicators to assess and track culture
  • Why is Culture a regulatory issue and what does the regulator intend?
  • Identifying behaviour that can harm or strengthen it
  • How to stimulate business-wide action to enhance culture; reviewing tools, metrics, management

Workshop Detail

  • Defining culture
    • Standard definitions, and examples of good or bad culture
    • Behaviour as underpinnings of Culture – indicators of culture and potential assessment methods
    • Regulatory approach to Culture and how this is evolving
  • Conduct, Culture and Value
    • Aside from the regulator, why is Culture key?
    • Behaviour (or conduct) as the basis for strategic implementation and value
  • Psychology of behaviour
    • Instinct and short term goals as key drivers of behaviour that underpin culture
    • Bias and flawed information, heuristics that underpin misconduct and Culture
    • Focus on behaviours and ‘social license’
  • Managing culture:
    • Competencies to strengthen Culture and key levers to transform behaviour
    • Tools and practices to embed lasting change (RIGHT, F&F, )
    • Ethical dilemmas

Optional Extra*

  • Culture Audits: Aligning claimed values and codes with front-line practices
  • FCA mock interviews

 

WORKSHOP THREE – Building better MI for management and reporting

  • Thursday 22 November
  • 10am – 4pm – Workshop
  • 4.30pm – 6pm – Optional extras 

Workshop Outline

  • Linking MI to decisions that drive firm value and meet regulators’ expectations – overcoming mindsets that obstruct or foster positive change
  • What we need vs what we have: building focused indicators for effective decision-making and governance
  • How better MI frameworks both produce and reflect improving behaviour and culture – the real success measure of Conduct initiatives
  • How to identify or enhance metrics that strengthen conduct, culture and decision-making to support long term value – applying the conduct lens to the full value chain

Workshop Detail

  • Planning and designing effective MI
    • Mindsets that obstruct or foster positive change – vested interests and “number comfort”
    • Linking MI to ultimate Long term value, however indirectly
    • Scalar vs linear indicators; adaptive dashboards and data integrity principles
  • What we have vs what we need
    • Using a behavioural lens to turn old backward looking indicators, into pre-emptive leading indicators
    • Asking better questions
  • Impact of better MI on Culture and implications for business management
    • As Critical analysis, interpretation and thought provocation tools
    • Balanced MI methodology – pictures, not triggers
    • Prioritising new and enhanced metrics – the benefits of newTech.
  • How to design better metrics
    • Examples and exercises from industry

Optional Extra*

  • Conduct and Culture Surgery

Agenda - Workshop Four

WORKSHOP FOUR – Innovative behavioural initiatives to embed conduct and culture and drive value

  • Monday 03 December
  • 10am – 4pm – Workshop
  • 4.30pm – 6pm – Optional extras 

Workshop Outline

  • Connecting leadership skills to SMCR and business value; define, measure, reward desired behaviours at all levels
  • Identifying value creative conduct: ‘moral courage’ to change practices, learn lessons, challenge status quo, foster feedback
  • Examples of tools, concepts and workshop content to build understanding and competencies at all levels
  • Competency frameworks to embed Conduct and Culture: align behaviours to training, reward models, firm values, goals and stakeholder expectations

Workshop Detail

  • Connect behaviours to SMCR, other elements of accountability and link to value:
    • Link to regulatory imperative and goals of the firm – both sustainable long term financial value and espoused values, accounting for external costs
    • Examples from other industries
  • Leadership skills to unlock neglected human capital value in all staff:
    • Prioritise, recognise, define and articulate desired behaviours at all levels
    • Demonstrate, measure, and reward desired conduct – crowd out perverse behaviour
  • Use revised competency frameworks to underpin desired behaviours
    • Innovation principles: ‘moral courage’ to seek out potential future opportunities and threats at all levels, reassess past decisions, learn lessons, challenge status quo
    • Followership models
  • Balanced behavioural competency frameworks
    • To communicate, guide and assess skills levels to refocus development and reward practices
    • Aligning Conduct, training, other activities to reinforce reward models
    • Integration into Conduct and business frameworks to embed conduct enhancement seamlessly into sustainable outcome oriented and value enhancing business model

Optional Extra*

  • Culture Audits: Aligning claimed values and codes with front-line practices
  • FCA mock interviews

Download the Agenda

The full workshop programme/agenda can be downloaded here: Academy Agenda

Optional Extras*
After each workshop the faculty will offer further tutoring in a variety of areas. Optional extras will be offered to delegates at an additional cost.

Extras include:

  • The opportunity to undertake a culture audit: demonstrating how practices are aligned with claimed good conduct and culture
    (workshop 2 & 4)
  • Participation in a mock FCA interview (workshop 2 & 4)
  • Access to a conduct and culture surgery (workshop 1 & 3)

Academy aims

Our Aim for the Academy

Our desire for the Academy is to instil a deeper and more strategic understanding of conduct risk, thereby focussing the industry on the value of good ethical practice, and a day-to-day appreciation of a positive culture.

The Academy brings together industry best practice with leading edge thinking and practitioner expertise to offer practical, effective solutions to define, assess, manage and embed good conduct and culture. Participants’ will develop their knowledge on responsible business practices which respond to both the evolving regulatory environment and customer requirements. They will develop frameworks, practices and behaviours which put customers and ethical values at the heart of decision-making, exactly as the regulator has asked the industry to do.

This approach supports the UK Finance ‘Vision and Values’ to play a significant role in helping to restore trust in the financial services industry and ensuring the UK retains its position as a world leader in financial services, reflecting continued leadership in regulatory innovation.

Championing good conduct

At UK Finance we are championing good conduct and ‘acceptable and expected behaviour’. Our aim with the Conduct Risk and Culture Academy is to help the cohort embed good conduct in their organisation and ensure the behaviour of colleagues is exemplary. Ultimately, we aim to help rebuild trust in the financial industry.

Each UK Finance member organisation should have staff who are trained in conduct risk with the knowledge, tools and confidence to socialise understanding of conduct risk. They should be ready and able to engage and promote constructive challenge, and positive change throughout the organisation.

Over the course of the three-month programme we will not only create ‘conduct champions’, we will work with individuals and throughout organisations to develop heightened conduct awareness, equipping individuals with the tools and knowledge to support positive cultural and behavioural changes. We will enable them to instil the mantra: ‘good conduct is good for business’.

A question from the FCA: ‘What proactive steps do you take as a firm to identify the conduct risks inherent within your business?’

When thinking about conduct risk, organisations reference similar phrases: ‘client outcomes’, ‘sustainability of their business’, ‘the danger of action or behaviours’, ‘reputational damage’, ‘conduct that could harm clients or undermine the integrity of financial markets’. Others refer to the FCA’s competition objective, namely, ‘to promote effective competition in the interests of consumers’.

Further, each organisation takes a different route to identifying conduct risk: A top-down model where key risks are mapped to business activity; a bottom-up model where each business unit analyses their own processes and identifies risks which are then aggregated; and a reverse engineered approach where processes are reviewed to identify threats to desired organisation-level conduct outcomes and the design of controls that could mitigate these risks.

Embedding an approach to conduct risk within your organisation is key.

What you will learn

At its core the Academy offers a rare learning environment where senior managers follow a three-month learning path which includes four one-day workshops supplemented by podcasts and downloadable resources.

Designed as a hands-on, experiential programme the Academy is grounded in practical examples so that participants will immediately find they can put their new insights to work. They will make tangible progress in enhancing and managing conduct and culture in a direct, sustainable and measurable way to meet regulatory, public and shareholder expectations.

This is an opportunity to study the latest best practice examples of conduct frameworks, culture audits, reporting dashboards, conduct indicators, culture evaluations and measurement and reporting tools.

The faculty will work with the cohort to identify new metrics, frameworks, and behavioural models that underpin risk models. They will introduce new qualitative thinking and direct observation of behaviour, to displace broken quant ‘econometric proxy’ models providing both experiential insight and immediately useable knowledge.

Along the way, the programme will include a Q&A panel with invited current and former senior regulators and professional conduct specialists.

Other benefits

Resources
Tangible outputs from the Academy include podcasts and digital downloads. These will cover topics including:

  • Prosecution hotspots: products/jurisdictions etc.
  • What does good behaviour look like? What will keep the regulator happy?
  • Applying behavioural insights to keep ahead of enforcement questions
  • Case studies and joint outputs

How you will learn

The Academy programme and content is designed to be agile, immersive and responsive, ensuring that we can understand the challenges faced by the cohort and tailor the programme accordingly. The three-month programme will feature up-to-date case studies identifying hot topics of enforcement in action and the latest news issues. It will be grounded in the latest industry information and up-to-date regulatory direction as well as well-established behavioural models, to engage innovative thinking. More pointedly, the faculty will use the cohort’s own experiences and challenges to make the programme as dynamic, practical and helpful, as possible.

Learning environment

To include but not restricted to:

  • Practical ‘lessons learnt’ Podcast interviews with senior conduct risk professionals
  • Dedicated private forums to discuss your experiences in confidence
  • Benefit from your faculty’s close analysis of other cohort participants challenges
  • Confidential environment enabling participants to help each other to solve challenges, evaluate opportunities, learn new skills and explore effective strategies
  • Receive detailed faculty feedback on your experiences
  • Q&A session with your faculty and senior practitioners to answer your critical questions
  • Learn from previous alumni, their experience and practical benefits
  • Carefully curated additional reading and resources so you can take your understanding further
  • Discuss case-studies on relevant topics and news issues

Social Learning

The cohort will be formed of a peer group who will learn from each other’s experiences and issues in a confidential and supportive environment under Chatham House rules. As experienced facilitators, the faculty will help the cohort explore individual concerns through frank conversation and ‘social learning’ where each participant is urged to share practical examples, best practice, concerns and successes from within their own organisation over the course of the programme. This 360-degree approach will ensure that each attendee can reflect fully on what they have learned, tailor their approach, and test different working practices within their organisation. The aim of the Academy is to offer practical, rather than theoretical, solutions.

Learning by doing

The approach of the faculty will be to encourage ‘action learning’ or ‘learning by doing’. Over the course of the programme the cohort will be encouraged to apply, test and feedback on what they have learned through each aspect of the Academy, sharing their experiences and best practice with the group to benefit from feedback and diverse perspectives. This learning cycle should reinforce better working practices and help the cohort to develop behaviours which put customers and values at the heart of decision-making.

Why you should attend

Good conduct is good for business

Good conduct should be a part of your everyday workplace culture, not least because of the direct benefit to your business value. Developing better conduct management can lead to:

  • Strategic and commercial competitive advantage;
  • A reduction in the cost of capital;
  • A positive, problem-solving and value-building culture;
  • Better morale, increased productivity and increased staff retention;
  • Improved customer satisfaction;
  • A demonstration of best practice in the sector (more than ‘just compliant’);
  • A recovery of the industry’s ‘social licence’ and public trust.
  • Defensive benefit: enhance relationship with regulators to avoid enforcement or remediation

A positive culture should be part of an organisations strategy, forming a pathway to long-term value creation and retention. It should inform long-term not short-term return on assets – financial returns on well-conducted business could be more durable. This aligns with changes in investment profiles for shareholders and with the regulatory expectations.

What does the regulator expect?

The Conduct Risk and Culture Academy responds directly to a) the regulator’s SMCR challenge which holds individuals accountable for minimum standards of conduct and positive culture across the whole organisation, and b) the conduct and culture supervision approach being developed – e.g. as reflected by the Annual Conduct Meetings and the ‘Five Conduct Questions’.

Under the Senior Managers and Certification Regime (SMCR), the FCA is closely scrutinising personal accountability in the way businesses are governed and how risk management is owned, under the umbrella of conduct and culture. Risk of enforcement action is high and levels of fines against individuals continue to rise. Senior managers, most client-facing, and many functional support staff are now personally responsible and liable for prosecution if not engaging in, or ensuring, good conduct.

The FCA has left the components of conduct risk deliberately loosely defined and is looking for the industry to show intelligent, applied thinking in ‘what good behaviour looks like’.

It is down to individual organisations to make use of behavioural principles to design policies and procedures that will drive an effective culture and deliver good customer outcomes. This is an opportunity for the industry to prove thought leadership, and apply behavioural science more rigorously for value creation and customer protection. The faculty for the Academy are experts in this field both with academic and practitioner expertise at the forefront of the subject. Critically, the philosophy of the Academy is to assess and respond to the needs of the cohort organisations in order to tailor the curriculum to changing and specific needs.

Benefits to your organisation

  • Use conduct initiatives and risk insights strategically for competitive advantage, and for building and protecting business value;
  • Move from reactive, box-tick or paper exercises, to meet and exceed the regulator’s conduct and culture expectations;
  • Develop a deeper understanding and a more robust response that overcomes current and future challenges regarding conduct and culture;
  • Develop embedded conduct risk leaders who can contribute to the strategic business development.

Who should attend?

You will benefit from attending if you work within any of the roles listed below:

  • A senior manager responsible for strategy or governance who needs to better understand how the new conduct and culture imperatives driven by regulators affect their business objectives and personal accountability under the Senior Managers and Certification Regime (SMCR);
  • A business or desk head who now has greater responsibility for managing conduct and culture in their teams and wants to develop their skills to drive sustainable value through better conduct and client relationships, or to better contribute to their firms’ overall cultural or values programme;
  • A leader of human resources or learning and development responsible for driving more effective training and competency regimes aligned with conduct principles, refocussing incentive and leadership programmes and for rebalancing controls relating to codes of conduct or ethics.

C-Suite and registered SMs should attend a separate workshop: Realising Strategic Value through Conduct and Culture – A one-day deep dive converting the regulatory agenda on Transforming Culture in Financial Services into real business value. Information on this workshop will be released soon, in the meantime, you can email training@ukfinance.org.uk to reserve your place.

Our faculty

Dr Roger Miles

  • Former practitioner turned academic: Was an auditor, investor relations, corporate affairs and advocacy leader. More recently a qualified psychologist and university lecturer.
  • Was BBA Director of Communications (1990s) under Sir Brian Pitman; Board Director in global research and consulting firms; and Head of Risk Communications in the Civil Service.
  • Works with major financial brands on conduct risk frameworks. Having interviewed 250+ firms participating in UK Finance conduct workshops and in-house programmes, 2016-17, he has amassed a unique body of work-in-progress examples of conduct programme and reporting designs, indicators and definitions. This is available to aid Academy discussions of what ‘good conduct’ looks like.
  • PhD in human behaviour (psychology of risk perception; motivation, behavioural governance and economics) and regulatory design.
  • Lecturer at Cambridge University (Centre for Compliance and Trust, Barclays sponsored initiative) and UK Defence Academy.
  • His original research (2006) identified psychological flaws in banks’ risk perception and recommended that government introduce a new approach, ‘behavioural regulation’; this happened in 2013, and is the basis for current conduct regulation.
  • Widely published (Reuters, FT, Berkeley, Risk Books, Kogan Page). Publications include: a handbook on applying behaviour analysis to conduct risk management; risk analysis of ‘how firms inadvertently encourage bad behaviour’, motives for ‘rule-gaming’, institutional deception and irresponsible risk taking; methods for anticipating change in public expectations of social licence ’acceptable conduct’.
  • Taught more than 3000 financial firm managers in 2017, and has taught more than 10,000 manager-level staff in financial, professional and government service during the past decade, normally one-to-one in small group settings (10-20 attendees). Course attendees consistently rate him at 95-100% (expertise, open and engaging, ease of understanding).

Patrick Butler

  • Patrick is Managing Director of Calitor – a regulatory risk management consultancy he founded in 2012.
  • A former Diplomat, Investment Banker, Operating Officer and Compliance head, he works with the Executive Committees of global and national banks to design and implement conduct and culture enhancement programmes and strengthen risk management functions.
  • Based on his extensive practical experience building risk management and compliance functions, in-house conduct academies and coaching senior managers he aligns business goals to long-term regulatory challenges via bespoke solutions integrated into the firm’s own practices, leveraging behavioural change and innovative outcome-focussed methodologies
  • Patrick is developing and implementing a business-wide conduct and culture enhancement programme, underpinning accountability aligned with SMCR, for the UK business of an overseas investment bank. This includes coaching senior management, desk heads and risk functions.
  • He designed and delivers a bespoke course on Regulation, Compliance, Conduct and Behaviour as part of a full Academy for all new intakes for one key client that provides operations control and compliance services to investment banks in the UK
  • Patrick restructured and refocused the Barclays Compliance Career Academy including academic expertise from Cambridge Judge Business School in 2015.
  • He was transformation lead for the compliance function in the RBS project to create a challenge bank (Williams and Glyn) in 2014, building a new target operating model, compliance programme and conduct Risk framework for the retail and small business activities of RBS England and Wales and NatWest Scotland branches that RBS was required to divest by the EU.
  • Patrick restructured and developed the corporate banking compliance function at Barclays to integrate it with Investment Banking Compliance and led the ExCom through cultural change in 2013 as the FCA came into being and the conduct regime in the UK began to grow
  • He also built out the Global Banking Compliance function in EMEA after Bank of America’s acquisition of Merrill Lynch, for the new combined platform in Corporate and Investment Banking, Capital Markets and Research between 2009 and 2012. He also led the FSMA S166 review on Information Controls and Culture to successful outcome in 2012.
  • Before joining Bank of America, Patrick was an Investment banker, business manager and head of strategic projects at HSBC Global Investment Banking and has an MBA from INSEAD business school.

Rebecca Aston

  • Rebecca Aston is Manager of Integrity and Ethics at the Chartered Institute for Securities & Investment (CISI). She oversees the delivery of the Institute’s Integrity initiatives to members and supporter firms, with the aim of raising and upholding ethical standards in the financial services industry.
  • Previously, Rebecca worked at the Association of Accounting Technicians (AAT) as Senior Conduct and Compliance Officer (2009-2014), with a particular focus on ethics and professional standards. In 2016, Rebecca completed a Master’s degree in Applied and Professional Ethics from the University of Leeds, and currently also tutors part-time on the ethics modules of some of the Professional Skills courses run by the university.

 

Attachments
Conduct Risk and Culture Academy
Workshop Details
Venue:

London




Start Date: 11th October 2018
End Date: 3rd December 2018

Price:

£3,500 (+VAT) – Members and Associate Members
£4,500 (+VAT) – Non-members

Optional extras*: £250

  • *Conduct and Culture Surgery with senior practitioners to answer their critical questions
  • *The opportunity to participate in mock regulator interviews
  • *The opportunity to undertake a culture audit