The Financial Stability Board (FSB), the organisation responsible for the coordination of financial regulation in the G20 countries, has issued a new toolkit for banks and regulators to assist in combatting of financial misconduct. The toolkit provides the option to hold senior personnel individually responsible for their conduct, it was announced on 20 April 2018.

According to the FSB, “Mitigating misconduct risk requires a multifaceted approach. The toolkit identifies 19 tools that firms, and supervisors could use to address three overarching issues previously identified by the FSB.”

The three elements are:

Mitigating cultural drivers of misconduct--including tools to effectively develop and communicate strategies for reducing misconduct in firms and for authorities to effectively supervise such approaches.

Strengthening individual responsibility and accountability--including tools that seek to identify key responsibilities and functions in a firm and assign them to individuals to promote accountability and increase transparency.

Addressing the “rolling bad apples” phenomenon--including tools to improve interview processes and onboarding of new employees and for regular updates to background checks to avoid hiring individuals with a history of misconduct.

The report was delivered to G20 Finance Ministers and Central Bank Governors ahead of their meeting in Washington DC from 19-20 April.