To support these metrics, standard-setting bodies, in particular the Basel Committee on Banking Supervision, have introduced principles for risk management and governance which have focused more on the technical attributes of organisational risk-taking than on individual or collective behaviour.
While the ‘second pillar’ of Basel III – with its enhanced coverage of all material risks and inclusion of corporate governance, culture, and values in the supervisory process – is encouraging, it appears that the rules repeatedly fail to address the organisational integrity of banks and bankers, and this has become the next frontier for ensuring the stability of domestic economies and the global financial system.