BIS Review 139/2009  5  Nonetheless, budgetary policy and the petroleum fund mechanism contribute to stability in the krone, as is clearly reflected in the movements in the krone in recent years compared with the currencies of other open economies with substantial exports of raw materials, such as Australia and New Zealand. The outlook for the Norwegian economy is better than for most other advanced economies. The rebound in activity will probably occur more rapidly, with inflation maintaining a somewhat higher level than in many other countries. Monetary policy measures, combined with petroleum investment and growth in public spending, have boosted activity. The downturn in the Norwegian economy may be relatively mild. The Norwegian authorities implemented a range of measures to mitigate the impact of the crisis on the Norwegian economy. As a result, the liquidity crisis did not turn into a bank solvency crisis or a crisis in the real economy. Norges Bank reduced the key policy rate considerably last autumn. The key policy rate has been reduced further in 2009 to 1.25 per cent. Norges Bank also stepped up its supply of liquidity to banks in the form of short- and long-term loans. The arrangement whereby banks could exchange covered bonds (OMF) for government securities made a contribution to securing long-term funding for banks. Strong growth in government spending fuelled demand for goods and services. The authorities supply risk capital to Norwegian banks through the Norwegian State Finance Fund to strengthen banks’ solidity.
As we look across the industry, hear the experiences of firms and read the emerging literature, like the recent report by the UK FCA, one can identify factors that are likely to impact, and possibly erode, cultural capital.6 I’ll outline several areas where these dynamics may be at play, including loss of personal interactions, severed networks, uncertainty, and decreased monitoring and oversight. Lack of personal interaction. The first dynamic is lack of personal interaction, which is critical to forming trusting relationships. As trust, a cornerstone of a good culture, is built through frequent interactions and reliable behavior, the lack of personal interaction at the workplace has the potential to weaken trust between colleagues, within teams, and across organizations.7 Trust is a complex human emotion that allows individuals to have faith in colleagues to do the right thing and not cause harm.8 Is it possible to sustain this ‘trust’ in colleagues as frequency of interactions decrease and the format of interactions make personal bonding more challenging?