On February 7, 2018, William Dudley, President of the Federal Reserve Bank of New York, participated in a panel discussion entitled "Banking Culture - Still Room for Improvement?" Mr. Dudley commented that there has been significant progress and improvement in bank culture, but noted that there is room for making even further progress. The discussion also highlighted that regulation and compliance are complements, not substitutes, for good institutional culture. Mr. Dudley also noted that while many often think that supervision by regulators and firm profitability are in conflict, in reality these two forces are aligned. The panel discussed that good culture can provide a competitive advantage with respect to recruiting, given changing priorities among the growing millennial workforce, the importance that bank culture plays in the health and maintenance of a financial institution's reputation, and how a good culture also promotes bottom-line success. The panel did note, however, that changing culture in large and complex financial institutions can be a very difficult task, and stressed that good firm culture needs to be promoted from the top down.
The full transcript of the panel discussion is available at: https://www.newyorkfed.org/newsevents/speeches/2018/dud180209.
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