The FCA’s discussion paper: ‘Transforming culture in financial services’ is welcome. But I speak as someone for whom that culture change has been a leitmotif for these last two decades. For the last few years I have also been a passionate advocate of purpose: “it’s a gravitational force that draws in and aligns teamwork, engagement, inspiration and creativity”. What’s so exciting is that that quote comes from a senior regulator: Jonathan Davidson, Exec Director of Supervision – Retail and Authorisations.
The paper also brings together in one place so much of the research and the orthodoxy that CEOs/Boards need to assimilate as they discover and engage with the fundamental importance of their firm’s purpose. Whether it’s the Edelman Trust Barometer’s finding that FS is the least trusted sector that it measures, the US Business Roundtable’s clear statement that the purpose of a corporation is to deliver value for all stakeholders, not just shareholders or Larry Fink (CEO of BlackRock) categorising purpose as the “engine of long term profitability”. Purpose has been mainstream for some time and this paper confirms that clearly.
The 59,000 firms regulated by the FCA will, no doubt feel that there is not enough detail in the paper about how they can effect culture change. The point is, as the paper says over and over, it’s about discovering your own purpose and finding ways of engaging your people in that purpose. As Nationwide’s most excellent Team Talk Initiative has identified, Shreena in Croydon and Bryan in Stoke will think that competence means different things: “our task is to create the conditions for them to discover it for themselves.”
The paper starts by nodding to four exemplar firms (without giving any great detail of the work they have done) and ends with a number of overlapping and complementary essays from academics and change practitioners whose messages resonate and build on each other. In the middle is perhaps the most striking piece: where luminaries from so many Chartered Institutes, representing the broader profession: pensions, insurance, retail financial services etc. all call for change and leadership, starting for example with clarity.
Loughlin Hickey, who I know well from time spent with the Blueprint for Better Business reminds us that none of this is new: back in 2010 in a letter to the FT about the causes of the financial crisis, leaders of FS firms wrote that only “the culture of organisations, and what they see themselves as existing to do” could protect society from similar future shocks.
If you are embarking on purpose or perhaps you have found yourself stalled, please, please pick up the phone. I honestly do love little more than talking about this stuff.