Speaking at the Eversheds Sutherland Conference - "Leadership and Culture Change in Financial Services"

Introduction

Good morning, ladies and gentlemen. I am delighted to be here this morning to speak at this well-timed and highly relevant event.   

There has been much discussion on culture in Irish financial services in recent months, particularly, but not exclusively, with reference to the Irish retail banks. 

I spoke at an event recently during which I highlighted the breakdown in public trust and confidence in banking, and the need for meaningful cultural change to repair and restore trust. I will expand further on this issue today as it extends beyond banking, and will also cover the work of the Central Bank with regard to behaviour and culture and the connected topic of diversity.   

The importance of culture

Culture is a somewhat nebulous concept, and much more difficult to define and measure than profitability, pricing, compliance with regulatory requirements, such as minimum capital requirements, liquidity coverage ratios, and so on.  But, that does not make it any less important - as the saying goes, it eats strategy for breakfast.

The Financial Stability Board defines culture as an "institution’s norms, attitudes and behaviours related to risk awareness, risk taking and risk management, or the institution’s risk culture." Or to put in another way, an organisation's culture is formed by the assumptions, values, expectations and beliefs, which drive behaviours of staff. When we talk about culture, what we are really talking about is behaviour.