How can firms drive down their conduct risk?

Understanding the main drivers of conduct risk, along with key steps for minimising it, will better equip firms to identify, manage and monitor effectively at all levels of their organisation, explains Frank Brown.

Frank Brown is a managing consultant at regulatory specialists Bovill (www.bovill.com). He has previously worked for Big Four consultancies and has been extensively involved in supporting consumer credit firms through the FCA authorisation process as well as in supporting clients across various sectors in the identification, quantification and mitigation of conduct risk.

For such an important topic, conduct risk is not adequately understood by financial services professionals. Unfortunately, it’s quite easy to see why. While conduct risk has been growing larger in the consciousness of regulators and boardrooms, there still isn’t an industry-wide definition. This may leave some firms unclear on how to minimise risk and establish a strong organisational culture.