The Special Needs of Financial Services Boards
Was the misconduct in financial services enabled by directors who did not understand their businesses?
This is the topic of a thought-provoking paper produced by PFS Principal Ian Laughlin and actuarial colleague Barry Rafe.
Many recent reviews into the financial services industry have identified widespread and systemic misconduct. Whilst some misconduct has been unlawful, much has been simply behaviour that has not met community standards and expectations. Ultimately In various reviews responsibility for the identified misconduct has been attributed to the board of directors and senior executive teams.
While the senior executive teams of these businesses carried direct responsibility, this paper argues that the poor behaviour may have been enabled by boards who lacked the necessary skills and capabilities for governance of complex financial services businesses.
This calls into question the processes for setting and realising a board composition that meets the special needs of these businesses.
The paper includes a Financial Services Board Assessment Aid to help in director selection for financial services businesses.
If you would like to know more, read on here: Special Needs of Financial Services Boards