We have seen progress in this area over the past few years with some firms hiring outside experts, engaging in cultural diagnostic work and implementing programs that focus on improving ethics, behaviors and internal culture. We’ve also seen progress in our direct engagement with boards of directors – and we’ve seen this across institutions of all sizes. When we, as supervisors, first began requiring deeper engagement with directors and senior leaders, the reactions varied, with an initial wariness of the purpose. In fact, directors were often accompanied by a compliance or regulatory relations liaison during our early interactions with them. Over time, though, as senior leaders and board members recognized the advantages of this level of engagement, the process has been smoother and our exchanges are becoming more engaging and direct (and few if any “escorts” are present during our interactions now). While the level of  2  BIS central bankers’ speeches  engagement varies across firms, in general, we are seeing boards being more active in asking questions, providing oversight of management and engaging with supervisors. We, in turn, have deeper insight into decision making dynamics at the board and c-suite level, including the how and why of decision making on key strategic issues. Regular communications also encourage early and proactive surfacing of issues. In addition, we’ve seen good progress in recruiting additional directors to complement current skills on the board – better positioning the board to engage with the senior management team in a productive and appropriately challenging way.
According to a report from the U.S. Department of Labor’s Bureau of Labor Statistics, the median tenure of workers ages 25 to 34 is only three years – less than a third of the tenure among people aged 55 to 64 years old. 1 And, according a Future Workplace “Multiple Generations@Work” survey, 91 percent of “millennials” (that is, a person born between 1977 and 1997) expect to stay in a job for less than three years. Job-hopping can speed career advancement. Getting a promotion in the process of changing jobs allows employees to avoid the “dues paying” that can keep workers in a painfully slow rise up the corporate ladder. Job hopping can also lead to greater job fulfillment. A 2012 survey by Net Impact 2 found that 88 percent of all workers considered “positive culture” important or essential to their dream job, and 86 percent said the same for work they found “interesting.” The same survey found that millennials are the least satisfied in their careers. I also recognize that firms are no longer just competing with others in the financial sector for talent. With skills that can be adapted across multiple industries, the talent pool that was once specialized for financial firms is now spread thin. This puts pressure on the firms and gives talented workers the advantage of being selective in their roles. They demand more from hiring managers and sense other opportunities out there if they’re not satisfied.