Diffused Accountability – Is Recalibration Overdue?

Individual accountability regimes and supervisory approaches need to keep pace with technological change in financial services

The Global Financial Crisis served as a catalyst for policymakers to focus on accountabilities – simply put, ensuring that by nailing down who is responsible for what within firms, governance within firms and regulators' supervision could be more effective.

This moved beyond the traditional model of regulating institutions and their boards, to include key individuals like business-line managing directors and individuals in positions with authority to commit their firms to significant transactions and the concomitant risks. Depending on the jurisdiction, these individuals below Board level have been referred to as 'senior managers' (UK), 'managers-in-charge' (Hong Kong), or 'accountable persons' (Australia) or as 'material risk takers'. The policy rationale here was to drive stronger and sounder governance and risk culture in the