This does not necessarily mean that Swedish bankers are more honest than American ones, just that the advantages of exploiting conflicts of interest are less and the costs are greater. My second conclusion is that it is important that all significant conflicts of interest should be discussed openly and publicly. There are justifiable claims for reliable information on borrowers and issuers, but the same applies to information on the measures taken by the banks to avoid exploiting conflicts of interest. I believe that there are relevant market solutions in most cases, as long as the conflicts of interest are clear. Thirdly, I would like to encourage the Swedish banks to carefully follow international developments within the field of compliance - i.e. the routines to ensure that internal and external rules are adhered to. In many cases the requirements have become much more stringent in recent years, and it is important to thoroughly assess developments in other countries. For instance, the Chinese wall has been repaired in the United States, and is now higher than ever. This has been achieved through legislation. It remains to be seen whether the Swedish banks can solve these problems themselves. Fourthly, I believe that the supervisory authorities play an important role with regard to identifying and overseeing potential conflicts of interest. Our Finansinspektion has begun to do this to a greater extent, not only with regard to banks but for the financial sector as a whole.
Employees shall usually work in the best interests of the company, but can in some contexts have interests of their own that are in conflict with the company’s best. Divisional managers within a corporate group may have an interest in promoting their own division rather than the group as a whole. Company management does not always have the same aims as the shareholders. Many of these conflicts of interest are common and quite natural elements of real life, and rarely cause problems. It is important to bear this in mind when discussing methods of dealing with them. This does not mean that conflicts of interest in financial operations are irrelevant, quite the reverse. The relevant question here, however, is which conflicts of interest are real problems and which are not. The conflicts without problems are those where there is little incentive to improperly favour one interest over another. For instance, most employees are usually loyal to their employer - otherwise they risk losing their jobs. A company that does not take into account the interests of its employees and its customers risks gaining a bad reputation and losing its competitiveness. Other conflicts of interest are more problematic. When an agent has a considerable incentive to favour one party at the cost of another, there could be scope for some form of regulations. Many companies also have ethical guidelines and rules for dealing with the cases where there is most incentive to take other interests into account.