Conduct Costs Project
The Project needs to be seen in the context of banks' "restore public trust" agenda and the apparently inexorable rise in regulatory penalties and other "conduct costs" being imposed on banks. These costs are a phenomenon worth studying in their own right but the wider implications are even more interesting.
The Project's findings for ten major international banks for the five year period ending 2013 showed an aggregate conduct cost total of just under £160bn. There is no reason to suppose that the figures for the period ending 2014 will show much improvement. Some of the fines imposed on banks in 2014 have come close to being life-threatening and, in at least one case, carried significant geo-political implications.
£160bn is a huge figure, so there is evidently some way to go. Banks understandably point out that many of these costs relate to what they now call "legacy issues" but it is perhaps a little too soon to be confident that they really are "legacy" and that the underlying problems have been solved. Other suggested approaches (seeking more "positive metrics") can be found in the Banking Standards Review Report. It remains to be seen whether or not any of these proposals will mature into something more "concrete".
If the banks' "trust crisis" is easy enough to identify, finding a solution to it is rather more difficult. The Conduct Costs Project represents a civil society response.
The Conduct Costs Project Association
Readers of this website will be interested to know that we have formed a new association for those who want to continue to have access to the detailed data that underpins the Project's famous "league tables" and participate in project-related events.
If you are interested to find out more, please contact Roger McCormick at email@example.com.