Marc Teasdale has spoken on FCA’s work with the asset management sector, and how it is intended more closely to align the sector with its essential purpose – that is, protecting and growing the capital and income of its customers over the long term. He said that firms with healthy cultures can show strong governance supporting the delivery on a daily basis of this purpose – and that part of this is a meaningful focus on diversity and inclusion. He looked at culture and its drivers – that is, leadership, people policies, governance and purpose – the latter being something beyond an economic function. FCA views it as a combination of a firm’s business model and the way in which it thinks about the social or economic contribution it provides. If a firm cannot articular its purpose in this way, FCA thinks that poor consumer and market outcomes are more likely to result. He gave the example of firms for which strong operational resilience is so inherent to the service they provide that it has to be a core part of their purpose – such as exchanges and custodians. Firms whose employees understand its corporate purpose are likely to have a meaningful one.
He discussed how the Asset Management Market Study had diagnosed weak governance as an important root cause of why the sector was not consistently delivering good value. He noted that good governance does not stop with the remedies proposed in the Market Study. Regulated entity governance and conflicts management are key, but more can still be done.
Finally, he spoke on diversity and inclusion and how people with different life experiences will bring new thinking and new approaches to problem solving and decision making.