Given the stronger focus of financial regulators on conduct and culture, such professional codes will matter greatly going forward as an important complement to regulatory standards. The FSPB is well placed to lead and support initiatives to establish standards of conduct for the financial industry. Its standards not only serve as useful frameworks for financial institutions and professional bodies to develop specific guidance for their own employees and members; they also serve to embody the industry’s collective commitment to socially responsible values and 1/3  BIS central bankers' speeches  ethics. For example, I noted with interest that the Professional Code being launched today commits to dealing with counterparties, including suppliers and agents that “subscribe to sound ethical principles”. Matters such as the environmental footprint or human rights record of third party providers are not typical obligations currently found in regulatory standards, yet, these are matters of great importance. They are a reflection of the values of the industry, and they matter to many conscientious consumers in this age of increasingly accessible information. Given the central role of financial services in any economy, these are issues likely to move from the periphery to increasingly important business considerations. At the global level, we are already seeing greater attention given to sustainable and responsible finance. In many cases, it will require the industry to draw on experience beyond the traditional core competencies of most financial services providers.
Finally, before I leave the banking system, I want to highlight one piece of good news in recent market developments. We have had a number of incidents of extreme market volatility over  2  BIS central bankers’ speeches  the past year or so – the removal of the Swiss Franc peg; a 30 basis point fall within 90 minutes in UST yields on 15 October 2014; the so called ‘Bund tantrum’ earlier in the year; and the seizure of US equity markets this summer, against the backdrop of news about China. These have raised a number of issues about changes to market structure and market liquidity. But the one dog that has not barked, however, is the transmission of the shock from these market events to the core banking system that support markets. For example, the reaction in UK banks’ CDS premia to these disruptions has been small and not out of line with broader market movements. I would put this down in no small part to the reforms of bank capital and liquidity that have made banks more resilient. So while money was lost in these market episodes and some people had a very bad day at the office, they did not cause wider shocks in the banking system. And that leads me in to the other subject I want to talk about today – the changes we are seeing in the liquidity of financial markets, which some indeed ascribe to reforms of the capital and liquidity standards in the banking system.