Alan Burr, Chartered FCSI and Chairman of the Risk Forum, outlines the highlights of Sir David Walker’s speech on corporate governance
When I first approached Sir David Walker to come and speak to us at the Risk Forum on the subject of corporate governance, I was absolutely delighted that he accepted the invitation without hesitation. He is the author of an important 2009 UK Government report: A review of corporate governance in UK banks and other financial industry entities. At the time he was still Chairman of Barclays Bank.
On Thursday 26 May Sir David spoke to a large audience at the offices of the international law firm Berwin Leighton Paisner in London Bridge. Members were then given the opportunity to ask questions, which were discussed in an open forum. I also had the opportunity to interview Sir David afterwards.
It has always been a long-held tenet that corporate governance lies at the heart of risk management and is of fundamental importance to the manner in which firms face the material risks that they encounter in the course of their business activities. Sir David addressed this point, speaking mainly about banks but not restricting his remarks to just that section of the financial marketplace. The references he made and the examples he gave are just as relevant to other non-banks in the financial services industry.
He referred to confidence with respect to conduct and highlighted the difference between trust and trustworthiness. Following such a long career in banking, he was able to look back at the culture of banking over several decades and made some perceptive observations about the impact of the financial crisis on economic activity, and the resulting regulatory initiatives which have addressed some of the standards of behaviour that had been observed in banks before the crisis.
There is a growing recognition that embedding the right culture is of paramount importance
He drew our attention to the efforts that banks have since been making to ensure higher standards of conduct and behaviour, and said that there is a growing recognition that embedding the right culture is of paramount importance. The persistence of a lack of trust in banking needs to be rebuilt, but this is happening.
Sir David is a long-term member of the Group of 30, and he mentioned the 2015 report by G30 which made a comprehensive set of recommendations with respect to embedding the right culture and values and the role of the board.
One of the biggest changes during the period since the economic crisis has been the effect of technology on the financial services industry, he said, referring to the “march of technology”.
It was a fascinating and stimulating presentation and discussion which attracted the attention of many members of the Risk Forum. We were only too pleased to thank Sir David for supporting our Forum and the CISI in general in making himself available to help us stage this important event which proved to be of great benefit to all concerned.
Watch Risk Forum: A conversation with Sir David Walker on CISI TV