A recurring question in regulation is to what extent a financial services’ regulator should hold itself to the same standards it expects of the industry. This tension lies under the surface of the Bank’s report on its approach to conflicts of interest post Charlotte Hogg’s resignation, although it’s noticeable that the external sources it cites are predominantly from the public sector.
From this perspective, the changes to the compliance function and the recommendation that the Court “revisit the question of executive responsibility for risk” are as significant as the appointment of a “Conflicts Officer”.
Overall too, while couched in central bank language, the substance of the recommendations – essentially the promotion of consistency over locally developed practices - may signal a sea change in what comes across as quite an informal culture.
The report by the non-executives said her case provided lessons for the Bank, including stronger checks before appointments and greater clarity about who takes decisions about conflicts.