The Monetary Authority of Singapore (MAS) recently issued guidance on the measures that financial institutions should implement to ensure a firmwide culture of ethical behaviour and increase senior manager accountability for employee misconduct.
Under the Guidelines on Individual Accountability and Conduct, which come into effect on 10 September 2021, banks and insurers are expected to have governance policies and procedures in place for ensuring senior managers are capable of setting the ‘tone from the top’ on expected standards of conduct.
The regulator stated that expected standards of conduct include honesty and integrity, fair dealings with customers, management of conflicts of interest, adequate risk management and compliance with applicable laws and regulations.
Board members and senior managers are also required to ensure:
- Appropriate managerial oversight of all material aspects of the firm’s business;
- Consistent and effective communication of expected standards of conduct;
- Appropriate policies, systems and processes for enforcing conduct standards;
- Transparent and timely communication of relevant material information to clients, shareholders, regulators and other key stakeholders.
Join Thomson Reuters and MyComplianceOffice for an interactive webinar discussing:
- How senior managers should cultivate prudent risk-taking behaviours and build robust risk management processes to comply with the guidance
- Which processes would help to promote individual accountability among senior managers, strengthen oversight of “material risk personnel” and ensure employees comply with conduct standards
- Examples of “material adverse developments” that boards and senior management are required to speedily report to the regulator under the rules
- The scale of enforcement actions that banks and insurers may face in Singapore and abroad if they fail to comply with Singapore’s new regime
- Ways for financial institutions to avoid penalties for compliance breaches by senior managers or employees, and examples of relevant cases from Singapore and other jurisdictions
- Potential civil and/or criminal penalties facing board members and senior managers for conduct breaches under the guidance, drawing on lessons from similar regimes in other jurisdictions
- How Singapore’s regime compares to similar rules implemented in other jurisdictions in terms of scope and cross-border application
- Dos and don’ts for financial institutions in responding to the Singaporean regulator’s guidance