This time last year, in my first column for City A.M., I cautioned that efforts to restore public confidence in parts of the financial services industry would be a marathon, not a sprint.
Now that I approach the finish line marking the end of my tenure as Lord Mayor, I am glad to see the City has taken major strides towards addressing the lessons of the financial crisis.
A keenly contested general election, relatively high unemployment and a patchy global economic recovery have made for a difficult political environment over the past year.
The industry has nonetheless worked in close partnership with policymakers on macro-prudential reform to examine how we can serve our clients – and ultimately the nation – better.
Our task, together with regulators, is to be the best at managing the risks we take. In this light, it is positive that British banks are already well placed to meet their Basel III capital requirements.
Regulation and oversight are part of the solution. What the City needs in this area is certainty, clarity and consistency. That is good for business and the country. It is worth remembering, however, that we are actually capitalists. And this means taking risks, because no risk means no gain.
A typical response to previous crises has been to increase the number of regulators and reams of regulations. This approach has not worked in the past and nor will it this time. Law and regulation in themselves cannot drive the actions of financial institutions and their staff. That can only come from the culture of individual organisations.
This has been a recurring theme during my time in office. I started this year with an event on ethical investing, took part in an event on corporate governance and ethics in the Square Mile, and then hosted a lecture by Stephen Green.
And last month, City leaders came together at Mansion House for a debate on how institutions can promote strong internal cultures and engage with the wider community as part of an industry-wide effort to rebuild trust. We must be sensitive to these issues, and others like bonuses.
But the City operates in an increasingly competitive international marketplace and policymakers should look to secure consensus with major G20 rivals rather than act in isolation.
My overseas business visits as Lord Mayor – 35 cities, in 21 countries – have shown me that the City continues to be held in high esteem globally.
We cannot, however, afford to be complacent. The danger is that rapidly developing markets in Asia and Latin America could edge ahead of us if we get reform wrong.So as I prepare to pass on the baton to the 683rd holder of this great office, Alderman Michael Bear, we must continue sprinting towards the line in order to defend the City’s status as a national and international asset.
Nick Anstee is Lord Mayor of the City of London