BRITAIN’S financial services regulator is looking at how investment banks and commercial insurers deal with sexual harassment, bullying and other non-financial misconduct amid complaints from those who say they are often gagged or forced to quit.
Sarah Pritchard, an executive director at the Financial Conduct Authority (FCA), told MPs last Wednesday (17) that it would survey the wholesale banking and insurance market to examine the prevalence of such misconduct and how it was detected and resolved.
“We can use what it tells us to take stock and to share best practices, but also, crucially, to inform our supervisory programme when the new rule sets come into place,” she told the Treasury Committee.
The survey, which will end by mid-year and show how employers decide staff are fit and proper to work in finance, was announced as MPs held the final session of a “Sexism in the City” inquiry into tackling sexual harassment and an “old boys’ club” culture in the industry.
The evidence session comes against the backdrop of sexual assault and misconduct allegations against hedge fund founder Crispin Odey and officials at the Confederation of British Industry, pitching Odey’s hedge fund and the trade body into crisis. Odey has denied any misconduct.
Forty women from 30 financial services companies, from boutiques to listed firms that spanned banking, insurance and asset management, met the committee to share their personal experiences of sexism and misogyny anonymously last November.
In a summary of discussions published by the committee last Wednesday, most attendees said they had directly experienced sexual harassment or knew of colleagues who had.
But the bar to reporting misconduct was high because, typically, the victim would be forced to move teams or leave the company or the industry.
They said non-disclosure agreements (NDAs) were widely used in sexual harassment cases to protect firms from reputational damage, silencing victims while protecting perpetrators and removing an incentive for firms to tackle such misconduct.
Attendee recommendations included a credible threat of fines and penalties for those condoning or perpetuating sexual misconduct, requiring firms to report the number of NDAs in such cases and that “fit and proper” standards of behaviour are followed.