Speaking at the Institute of International Finance's Washington Policy Summit, Carney said a greater emphasis should be put on individual responsibility for bankers.
"Authorities cannot and should not try to legislate for every circumstance, watch every transaction, or anticipate every market innovation. So while fines and sanctions have roles in deterring misconduct, they will not, on their own, bring about the cultural change we need."
He added: "We must move from an excessive reliance on punitive, ex post fines of firms to greater emphasis on more compelling ex ante incentives for individuals, and ultimately a more solid grounding in improved firm culture."
Carney called for a "dynamic" approach to regulation that was flexible but ensured the global financial system remained resilient.
"Authorities must learn by doing and make adjustments, as necessary, to optimise our efforts, without compromising on the level of resilience the reforms are intended to achieve," he said.
He said the Financial Stability Board (FSB), which he chairs, was working on a review of regulation since the financial crisis.
Carney also spoke of a fear of splintering global financial regulation post-Brexit.
The global financial system faces a "fork in the road", and Britain should avoid taking steps that would lead to its fragmentation, he said.
"Brexit will be a litmus test of the future of international cooperation. The UK and the rest of the EU have exactly the same rules and the most highly developed frameworks of supervisory cooperation. Their capital and banking markets are already highly integrated. They have the potential to create the template for trade in financial services."