Get in touch
FSCB
  • Home
  • Who We Are
    • Who We Are
    • Our Board
    • Our Team
    • Our Governance
    • Our History
    • Working At The FSCB
    • Our Work Outside Membership
  • What we do
    • What we do
    • Behavioural Science
      • Wellbeing
      • Future Of Workplaces & Technology
      • Purpose
      • Diversity & Inclusion
      • Speaking Up & Listening
      • Ethical Behaviour & Accountability
    • Employee Survey
  • What is membership?
    • What is membership?
    • FSCB Associates
    • Our Members
  • Our Latest
No Result
View All Result
No Result
View All Result
  • Home
  • Who We Are
    • Who We Are
    • Our Board
    • Our Team
    • Our Governance
    • Our History
    • Working At The FSCB
    • Our Work Outside Membership
  • What we do
    • What we do
    • Behavioural Science
      • Wellbeing
      • Future Of Workplaces & Technology
      • Purpose
      • Diversity & Inclusion
      • Speaking Up & Listening
      • Ethical Behaviour & Accountability
    • Employee Survey
  • What is membership?
    • What is membership?
    • FSCB Associates
    • Our Members
  • Our Latest
FSCB
No Result
View All Result
Home News Assesssment

Linking the FSCB Culture Survey to tangible outcomes in financial services

FSCB Head of Data Science Nick Wainwright on how businesses benefit from a data-driven culture

2022/08/04
in Assesssment, Insights, News
Reading Time: 4 mins read
A A
0

This article was written by Nick Wainwright, Head of Data Science, FSCB

At the FSCB we define a good culture as one that produces positive outcomes for customers, clients, and society as a whole. Recognising that organisations differ in so many ways and that there is no ‘one size fits all’ optimum culture, what we do is measure how far organisations can demonstrate that they possess nine characteristics that our extensive research has indicated would underpin a good culture: honesty, respect, openness, accountability, competence, reliability, resilience, responsiveness, and shared purpose. We assess culture in this way because we believe that it is a way of predicting outcomes (i.e., a firm that scores more highly in our Survey is more likely to generate tangible benefits to its stakeholders than one that has lower scores). This, however, is a very difficult relationship to robustly demonstrate as it requires a lot of observations, both in terms of organisations taking part in the Survey over many years and subsequent outcomes data. Now with our dataset having grown – the 2022 FSCB Survey is our seventh annual exercise assessing culture at financial institutions in the UK – we can begin to explore the link between results in our Survey and outcomes that truly matter to firms and society at large.

Measuring ‘good’ outcomes

Thinking back to when we at the FSCB (then known as the Banking Standards Board) first began to systematically assess culture, we identified different types of outcomes as being desirable for different stakeholders. For customers or clients, a key question is whether the products they are offered are appropriate to their needs and circumstances, and clearly explained. For society – and especially one in which the aftermath of the 2008 financial crisis continues to reverberate – a positive outcome might be described as a sustainable and trustworthy financial services sector in which systemic risk is appropriately recognised and managed.

No single metric can perfectly capture the full range of outcomes, particularly not ones that are available for a wide range of organisation (e.g., universal banks, large and small building societies, investment banks, private banks, and challengers). In this initial exercise we have taken two approaches.

  • For customers, we have focused on conduct risk using publicly reported complaints data from banking and credit card accounts collected by the FCA. The hypothesis here is that a firm which is meeting customers’ individual needs will, all other things being equal, attract fewer complaints than one that is not.
  • For society, we have focused on prudential risk by looking at Z-scores[1] that can be extracted or derived from data reported by large firms. The greater the Z-score, the further the firm is from default, and therefore, it is hypothesised, the lower the level of prudential risk.

Data matching exercises are often messy and each of these outcome measures have their limitations.

  • Both metrics are, for example, more readily available in public datasets for larger organisations and often unavailable for smaller or medium-sized firms.
  • For complaints data there is an inherent information asymmetry which means that it may not be apparent to customers if a product is not in their best interests, or it can take quite some time for such doubts to materialise.
  • In the case of Z-scores, some of these were available based on firm’s international entities, but the FSCB dataset on experiences or perceptions of employees that this is matched with is based on employees in the UK.
  • There is also the question of time lag: a particular action that a firm takes now may lead to wider impacts at a future point in time, whether those be positive or negative, but the time it takes for these effects to be realised is difficult to predict.

Initial findings, partnerships and next steps

The initial analysis conducted was based predominantly on linking the FSCB Survey scores with publicly available Z-scores and complaints data as outlined above. This data linking was possible for all large, systemically important institutions in the FSCB dataset, but not for several of the small or medium sized organisations where outcomes data was unavailable. Correlation analysis and regressions, which allowed for the size of organisations to be controlled for, were carried out.

The results from this work indicate that the FSCB question set as a whole correlates positively with lower levels of prudential risk and better customer outcomes. In particular:

  • employee perceptions on risk orientation (e.g., respect for Risk and Compliance, following the spirit of rules and not just the words) and customer centricity (e.g. responding effectively to customer feedback and innovating in the best interests of customers) link with lower levels of prudential risk; and
  • Environments where leaders are seen as authentic (e.g. senior leaders meaning what they say), where employees believe that the organisation is customer-centric, and where there are higher levels of psychological safety (e.g. not worrying about negative consequences when raising concern) are associated with lower levels of customer complaints.

While these results are an encouraging first step in demonstrating a link between culture assessment and outcomes, they should be considered in the context of the caveats outlined. We will continue to build on this work and look to complete this analysis in a way that encompasses a wider range of firms and potentially other outcome measures. In this context, we have also begun a partnership with researchers at the Bank of England to measure cultural cohesion or fragmentation in firms to establish how this is associated with prudential and business outcomes. This work will draw not only on the FSCB dataset that captures employees’ perceptions of their organisation’s culture but also on other external data sources. We look forward to sharing results of our research in this area as it becomes available. if you’d like to know more or have ideas on this subject, please get in touch.

Joining the FSCB (or working with us as a Working Culture client, if outside the financial services sector) can help you assess, understand and improve your firm’s culture.

Find out more about the FSCB survey or contact us at info@fscb.org.uk.

[1] Z-scores are a measure of the number of standard deviations on a firm’s return on assets is required to offset the amount of regulatory capital it holds. They are widely used as a proxy for the probability of default.

Share28Tweet18Share5
Previous Post

Senior Analyst, Assessment and Insights

Next Post

Sharing diversity data

Next Post

Sharing diversity data

Latest News

Diversity & inclusion

Meeting practices can promote inclusion at work

9 August 2022

This article was written by Carol Franceschini, Senior Behaviourial Scientist, FSCB and Alex Maloftis, Senior Data Scientist, FSCB This article...

Read more
Diversity & inclusion

Sharing diversity data

5 August 2022

The FSCB has launched a new applied research programme for its members within our Diversity and Inclusion (D&I) thematic work....

Read more
Assesssment

Linking the FSCB Culture Survey to tangible outcomes in financial services

4 August 2022

This article was written by Nick Wainwright, Head of Data Science, FSCB At the FSCB we define a good culture as...

Read more
Careers

Senior Analyst, Assessment and Insights

22 July 2022

We are looking for a Senior Analyst, Assessment and Insights to join the Insights team at the Financial Services Culture...

Read more
FSCB Professionalism in banking.
  • Who We Are
  • What we do
  • What is membership?
  • Our Latest
  • Privacy Policy
  • Cookie Policy
  • © FSCB 2021

FSCB

info@fscb.org.uk
St Magnus House
3 Lower Thames St
London EC3R 6HD
020 3781 9696
No Result
View All Result
  • Home
  • Who We Are
    • Who We Are
    • Our Board
    • Our Team
    • Our Governance
    • Our History
    • Working At The FSCB
    • Our Work Outside Membership
  • What we do
    • What we do
    • Behavioural Science
      • Wellbeing
      • Future Of Workplaces & Technology
      • Purpose
      • Diversity & Inclusion
      • Speaking Up & Listening
      • Ethical Behaviour & Accountability
    • Employee Survey
  • What is membership?
    • What is membership?
    • FSCB Associates
    • Our Members
  • Our Latest

This site uses cookies. By continuing to browse the site, you are agreeing to our use of cookies. Find out more. ACCEPT
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Non-necessary
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
SAVE & ACCEPT
X