Rule-breaking bankers treat their abuses as if they were just breaking a speed limit, not something really serious, says Elizabeth Corley, global chief executive at Allianz Global Investors.
Investment professionals seem to only see gray when looking at ethics and regulations, reports the Telegraph. In fairness, says Corley, the markets are complicated and move quickly. Regulations have changed drastically in recent years.
“One of the things we found in talking to management, legal and compliance, and audit, is that very often, people were confused about what right and wrong was,” Corley told The City UK’s annual conference.
Look at hedging risk versus influencing market prices. If no one is going to get hurt, why not fudge the line a little? But bad investment behavior needs to be likened to drunk driving, not speeding, says Corley.
“How many people have been tempted with a clear empty road ahead of them and a 30 mile an hour speed limit to think that they know better than the limit and to ease their foot down a little bit? Most people would do that,” she said.
Big fines as punishment draw attention to problems, but don’t solve them, many at the conference agreed. “Just beating people up doesn’t change behavior for the long-term,” says David Nish, CEO of Standard Life.
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