SINGAPORE - The Monetary Authority of Singapore (MAS) is seeking feedback on proposals to strengthen the individual accountability of senior managers and raise standards of conduct in financial institutions.
The proposed guidelines include requiring financial institutions to identify senior managers who are responsible for core management functions and clearly specify their individual accountability. Financial institutions should ensure that senior managers are fit and proper for their roles and hold them individually responsible for the actions of their staff and the conduct of business.
Employees in material risk functions that can significantly impact the financial institution's safety and soundness, or cause harm to a significant segment of the financial institution's customers or other stakeholders should also be identified and subject to an appropriate incentive structure and risk governance, MAS is proposing.
Financial institutions should also have a framework that promotes and sustains the desired conduct among all employees, and there should be appropriate incentive systems and effective feedback channels such as whistle-blowing mechanisms in place.
MAS is proposing to give financial institutions operational flexibility to determine the most appropriate ways to achieve the desired outcomes of proper accountability and conduct, and will monitor implementation through regular supervisory engagements.
Ong Chong Tee, deputy managing director of financial supervision at MAS, said in a statement: ""Clear accountability and proper conduct are important elements of good governance and sound business practice. Persistent misconduct and a lack of individual accountability by persons in charge will erode public confidence in our FIs. We expect the boards and senior management of FIs to instil a strong culture of responsibility and ethical conduct."
The consultation lasts until May 25, 2018.