CMI and CII Call for Ethical Focus in Management Decision Making
A new report launched today by CMI and the Chartered Insurance Institute (CII), Good Leadership, investigates the ethical culture of management within the financial services industry.
The report includes data from a MoralDNA personality profiling of 24,000 financial services professionals, with new analysis revealing that managers rank in the bottom quarter of employees based on how likely they are to show the ‘ethic of care for others’ at work. This means that managers are among the group of workers most likely to suppress empathy and are less concerned with the impact of ethical decisions on people compared to other employees.
The report also finds that financial services managers are more likely to be concerned about complying with the rules and consider principles in their decisions and behaviours, than they are about getting good outcomes for their customers, their stockholders and other stakeholders.
Sian Fisher, Chief Executive at the CII, said:
“The new regulatory focus on business culture is an opportunity for individuals and firms to improve public confidence in the financial services sector.
“However, it is no longer enough for individuals and firms to simply ‘comply’ with regulators – we must aspire to ‘go beyond compliance’ and drive up ethical standards within our industry. As a professional body, it is important that the CII supports our members and the wider sector in developing ethical cultures.”
Ann Francke, chief executive of the Chartered Management Institute, added:
“Mis-selling, rate fixing and rogue trading have tarnished the reputation of the UK’s world-leading financial services sector. We need leaders and managers to redouble their efforts to improve company culture. Leaders have to enable, empower and reward people to do the right thing, not just the thing that looks profitable in the short term. Without strong ethical cultures, regulation and compliance will never be enough.”
The report calls for financial services to provide ‘good leadership’ through 9 key steps:
1. Discuss and re-define the business’s values
2. Ensure clear leadership on the values – set the tone from the top
3. Upskill employees to help them understand what behaviours are acceptable
4. Build a commitment to professional standards into staff development from the start of your career
5. Engage with the spirit of regulation, rather than resentfully box-ticking
6. Reward and recognise ethical behaviour
7. Cultivate diversity through recruitment and promotions
8. License people to discuss difficult issues without recriminations
9. Constantly review and communicate ethical principles to employees
The full report can be downloaded at www.managers.org.uk/financialservicesethics
About Good Leadership: Culture, ethics and conduct in financial services
The report includes contributions featuring Nick Leeson, the original rogue trader, on his perceptions of the culture in financial services institutions today; Prof. Roger Steare, Corporate Philosopher in Residence of Cass Business School and founder of MoralDNA™; and Ian Muir of Keeldeep Associates, a senior leader and business author; plus a case study interview with a senior leader in a major wealth management fund.
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For further information, interviews or case studies please contact:
Notes to editors
The Chartered Management Institute (CMI) is the only chartered professional body for management and leaderships, dedicated to improving managers’ skills and growing the number of qualified managers.
Our professional management qualifications span GCSE to PhD equivalents, including the unique Chartered Manager award, which boosts productivity and improves workplace performance as well as increasing earning potential.
We provide employers and individual managers with access to the latest management thinking and with practical online support that helps them to embrace change, create high-performing teams and keep ahead of the curve.
With a member community of more than 136,000 managers and leaders, we promote high standards of ethical practice through our Professional Code of Conduct, and help managers to build their expertise through online networks, regional events and mentoring opportunities.
About the CII:
The CII is the world’s leading professional body for insurance and financial planning. Its more than 125,000 members are committed to maintaining the highest standards of technical competence and ethical conduct.
A robust framework of learning and development solutions enables the CII to support corporate partners and individuals across the industry. It ensures that all members comply with minimum standards and inspires many more to achieve advanced levels of technical and professional competence.
Follow the CII on Twitter, where you will be kept up to date with latest press releases, media appearances and expert commentary: www.twitter.com/CIIGroup