MAS issues guidelines to strengthen culture of responsibility and ethical behaviour in the financial industry
Singapore, 10 September 2020... The Monetary Authority of Singapore (MAS) today issued guidelines to strengthen the accountability of senior managers in key functions in financial institutions (FIs) and to promote ethical behaviour in FIs. The guidelines were accompanied by an information paper on good practices in these areas.
Outcome 1: Senior managers“Senior managers” refer to individuals who are employed by, or acting for or by arrangement with, the FI, and are principally responsible for the day-to-day management of the FI. responsible for managing and conducting the FI’s core functions are clearly identified.
Outcome 2: Senior managers are fit and proper for their roles, and held responsible for the actions of their employees and the conduct of the business under their purview.
Outcome 3: The FI’s governance framework supports senior managers’ performance of their roles and responsibilities, with a clear and transparent management structure and reporting relationships.
Outcome 4: Material risk personnel“Material risk personnel” refer to individuals who have the authority to make decisions or conduct activities that can significantly impact the FI’s safety and soundness, or cause harm to a significant segment of the FI’s customers or other stakeholders. are fit and proper for their roles, and subject to effective risk governance, and appropriate incentive structures and standards of conduct.
Outcome 5: The FI has a framework that promotes and sustains among all employees the desired conduct.
4 FIs should also promote a culture of ethical behaviour by strengthening practices in other areas set out in the Information Paper on Culture and Conduct Practices of Financial Institutions. These additional areas include hiring, communication channels, monitoring and assessment, and performance management. The paper contains examples of good practices gathered from a thematic survey and dialogue sessions conducted by MAS with banks, insurers and capital market intermediaries.
5 FIs should use the guidelines and the guidance in the information paper to develop and entrench a strong culture of responsibility and ethical behaviour within their organisations. MAS will continue to engage FIs, their boards, senior management and other employees on the adequacy and effectiveness of their culture and conduct practices through its ongoing supervision.
Notes to Editor
Guidelines on Individual Accountability and Conduct
The accountability regimes in other jurisdictions include the United Kingdom’s Senior Managers and Certification Regime and Conduct Rules, Hong Kong’s Managers-in-Charge/Management Accountability Initiative Regime, and Australia’s Banking Executive Accountability Regime.
MAS has in place existing legislation and guidelines that address many elements of these jurisdictions’ accountability and conduct regimes. The Guidelines on Individual Accountability and Conduct supplement the existing framework, focusing particularly on the measures that FIs are expected to put in place to strengthen the accountability of senior managers and promote ethical conduct at all levels of the organisation.