LONDON, Oct 20 (Reuters) - Regulators should not get involved in setting the culture of a bank, which should remain the preserve of individual firms as they try to restore trust, the chairman of Barclays said on Monday.
David Walker, who became chairman of Barclays in November 2012 after a string of scandals related to alleged benchmark rate rigging and mis-selling payment protection insurance, said there was “urgent need for proactive initiative by the banking industry to turn the tide” after the erosion of trust in banking conduct.
“Regulators cannot and should not try to regulate culture, which is a matter for the individual entity,” Walker said in a speech given at the New York Federal Reserve.
“This is a journey to which the best support from the regulator is likely to be in the form of high level and relatively detached encouragement rather than prescriptive rule-making, which is all too likely to be counterproductive,” said Walker, who will step down as Barclays chairman next April.
He set out a series of steps that banks should take to transmit its culture across all its employees, including many he has implemented at Barclays as he tries to restore the bank’s reputation.
They include a call for banks to set up committees at board level to guide and oversee the executive effort related to behavioural issues. There should also be “prompt remedial or disciplinary action in respect of individuals or teams whose behaviour falls short,” he said. (Reporting by Steve Slater; Editing by Greg Mahlich)