The financial services sector needs to hold itself accountable, rather than merely relying on regulators, to truly regain the public's trust, a former Lord Mayor of London has said today.
Sir Alan Yarrow was speaking at the launch of the Certificates of Professionalism initiative from the Chartered Institute for Securities & Investment (CISI) and the Chartered Banker Institute, which represent more than 70,000 individuals between them.
The initiative is designed to support, but also go beyond, the Senior Manager and Certification Regimes, which were rolled out for certain financial businesses, including UK banks and building societies, back in March.
"We as an industry need to own our regulation," said Yarrow, who is also the chairman of CISI.
He added: "We, the industry, need to recognise the spirit and principle of good regulation so we can extend its reach into areas where the regulator cannot see. There is a long way to go."
Simon Thompson, chief executive of the Chartered Banker Institute, questioned how low the regulators' bar has previously been for determining who was ethically eligible to work in the industry.
"In the old days it seemed to be if you hadn't been to jail, you were fit and proper," Thompson said, adding this didn't "seem right in any walk to life" let alone banking.
The CISI and Chartered Banker Institute certificates will act as an additional third-party verification service, which is designed to help firms show they are operating with the highest ethical standards.
"You know and we know that the banks have [changed a lot over the past years] but where's the tangible evidence of that?" said Simon Culhane, CISI chief executive.
The launch of the certificates comes at a time when question marks have been raised about ethics in the City.
Over the last 18 months, no fewer than five former bankers have been handed jail sentences in the UK for Libor-rigging related offences, a scandal which has rumbled through the City since it first broke in 2012.
Meanwhile, two so-called rogue traders have recently flagged that many of the hallmarks which existed at the time they were working still taint the sector today.
Former UBS trader Kweku Adoboli warned the banking industry could be so all consuming that it could easily warp traders' moral compass, telling City A.M.: "You live in that bubble day-in, day-out, minute-in, minute-out, with little sleep and that becomes your culture – profit at any cost."
Nick Leeson told The Times today the only way to prevent another banking scandal would be to get rid of everybody working in the industry today and start with "a blank sheet of paper".