The Chartered Insurance Institute (CII) is stepping forward to help lead the sector’s response to non‑financial misconduct, and makes clear that regulation alone will not change culture.
In a new report, the professional body identifies greater public reporting on complaints, processes and outcomes as a potential lever to strengthen accountability and accelerate cultural change.
In alignment with the FCA’s new COCON rules and guidance, the CII assembled regulatory representatives, compliance experts, employment lawyers, behavioural scientists, campaigners and sector leaders to examine why non-financial misconduct persists and what can be done to address it. This was the first roundtable in the CII’s thought leadership campaign on addressing non-financial misconduct. It was agreed that intervention is necessary, as rules and guidance alone are inefficient in addressing behavioural and cultural dynamics such as in-group bias, normalisation and suppression of reporting, which enable misconduct.
As well as public reporting, the report identifies areas for further consideration to include commercial pressures, where fear of reputational damage prevents action against misconduct; and the establishment of internal capability for firms to exercise consistent judgement on misconduct. It was also agreed that small firms are likely to require targeted support to address the structural challenges of small firm environments.
Matthew Hill, CII Chief Executive, said: “Behaviours such as bullying, harassment and discrimination damage careers, confidence and wellbeing, sometimes irreparably. When this behaviour goes unchecked, it also weakens organisational culture, damages firms’ reputations and undermines trust in the market. The CII is committed to working with the regulator and stakeholders across the profession to turn non-financial misconduct policy into impactful practice, and promote professional, healthy working environments”
Vanessa Riboloni, Head of Research at the CII, said: “Prior to the roundtable we conducted a review of non-financial misconduct literature, founded in the recognition that knowing right from wrong, and having codes, training and policies in place, is not in itself enough to produce good behaviour. The review reveals the mechanisms that allow misconduct to take root are often the same mechanisms that silence those who witness or experience it. These dynamics interact with organisational choices. A flawed individual in a well-run firm lacks the opportunity to act; a permissive culture can draw misconduct from people who might not otherwise offend. The encouraging part is that these mechanisms can be disrupted, and because the same dynamics drive both the misconduct and the silence around it, tackling them may improve prevention and reporting at the same time.”
The report comes ahead of PIMFA’s (Personal Investment Management & Financial Advice Association) publication of non‑financial misconduct guidance on 23 June, developed in collaboration with the CII and CISI (Chartered Institute for Securities & Investment) .
The next phase of the CII’s research will move beyond understanding why misconduct persists, to testing which interventions are effective. Priorities include piloting interventions within firms, developing baseline measurement frameworks, creating anonymised case study resources, and providing psychological safety support for those who report misconduct.
