The March 2023 banking turmoil — encompassing the failures of Silicon Valley Bank, Credit Suisse, and other institutions — exposed critical deficiencies in both firm-level risk governance and supervisory oversight. Post-mortem analyses agree that these failures were not only attributable to capital and liquidity shortfalls, but also to breakdowns in institutional culture, internal challenge mechanisms, and supervisory responsiveness. This report presents the findings of a global stocktake exercise that convened dozens of senior financial sector supervisors from jurisdictions spanning Canada to New Zealand. The study draws on structured interviews with senior leaders of prudential and conduct authorities, international standard-setting bodies, and central banks, supplemented by insights from the more than 200 contributors to the Starling Insights Compendium — an annual research series on culture and conduct risk in the financial sector published since 2018 — and related Starling research publications. Scholarly contributions from leading academics in economics, organizational behavior, and corporate governance further frame the analysis. Contributors broadly affirm that culture constitutes a prudential concern, functioning as a leading indicator of both conduct and safety-and-soundness outcomes. Yet the study documents persistent obstacles to effective practice: definitional incoherence across jurisdictions, the absence of shared analytical frameworks linking cultural conditions to prudential outcomes, and an entrenched reliance on reactive, post-hoc supervisory postures. The report finds that culture-related supervisory initiatives remain largely experimental and marginal to core supervisory processes, and that supervisory agencies' own institutional cultures often impede the proactive intervention that culture risk supervision demands. This Final Report summarizes the key findings from the Public Exposure Draft published in 2025 and incorporates comments from leading bank industry bodies. The report calls for a shift from ad hoc diagnostic exercises toward cross-jurisdictional frameworks that discipline supervisory discretion without prescribing uniform cultural norms. The report concludes that trust in the financial system requires a collaborative public-private effort to develop the analytical infrastructure needed for culture risk governance and supervision, and that the legitimacy of the supervisory function itself depends on this modernization.
