In times of crisis and economic downturn, firm culture plays a more important role than ever in guiding individuals' behaviour.
In this article, we consider why culture is so important, what can be done to create and reinforce a good culture and how regulators are likely to approach the question of a firm's culture in the aftermath of the crisis.
We argue that regulators, and the public more broadly, are unlikely to take the view that firms should be given any latitude in relation to culture and compliance shortfalls that occur during the crisis.
On the contrary, it is more likely that the way a firm treats customers, staff, investors and its approach to compliance at this time will be subject to scrutiny at a later date, with the full benefit of hindsight and when memories of the unprecedented scale and nature of the issues presented by the pandemic will have faded.
We suggest that looking to the future underscores the importance of reinforcing compliance culture now.
"...firms must take positive and proactive steps to maintain firm culture and strengthen compliance at times of particular stress, even if those compliance measures look different than they did before the covid-19 crisis."