Following a global stocktaking exercise that convened dozens of senior financial-sector supervisors, ranging from Canada to New Zealand, the Deeper Dive study captures emerging views regarding necessary reform efforts addressing culture risk governance and supervision. Randal K. Quarles, former U.S. Federal Reserve Board Vice Chair for Supervision and past Chair of the Financial Stability Board, chaired the stocktake and led the report’s production. Chapter co-chairs included Wayne Byres, former Chair of the Australian Prudential Regulation Authority; Elizabeth McCaul, a former Member of the Supervisory Board of the European Central Bank; Carolyn Rogers, Senior Deputy Governor of the Bank of Canada; and Fernando Restoy, Chair of the Financial Stability Institute. Since the Global Financial Crisis, conduct and prudential regulators alike have increasingly identified organizational culture as a root cause of misconduct and failures in risk governance control systems. Post-mortem reviews of the 2023 banking sector turmoil likewise concluded that supervisory culture contributed to oversight lapses, the failure of several U.S. regional banks, and the near-collapse of Credit Suisse, a global systemically important bank, or G-SIB. Despite heightened concern about culture as a supervisory and policy issue, no global effort has yet defined core terms or established common frameworks or metrics to facilitate culture risk governance and supervision. “Supervisors on Supervision” sets the stage for doing so.
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