In a damning indictment of the City’s corporate culture, a survey by the financial watchdog has revealed that firms rarely penalize employees for misconduct, even as complaints about harassment, bullying, and other offenses hit record highs. The findings paint a troubling picture of an industry that still struggles to hold wrongdoers accountable, especially those in positions of power.
Misconduct Complaints Surge 40% in 2023
The Financial Conduct Authority (FCA) surveyed 1,000 banks, brokerages, and insurance firms, revealing a staggering 40% increase in non-financial misconduct complaints last year. In 2023 alone, these organizations reported 2,347 incidents, up from 1,670 in 2022 and 1,363 in 2021. While it’s unclear whether the surge reflects worsening behavior or a greater willingness to speak up, experts suggest the pandemic and the gradual return to offices likely played a role.
Harassment and Bullying Dominate Complaints
Over the three-year period, bullying and harassment accounted for 26% of all misconduct complaints, while discrimination made up another 23%. The remaining complaints covered a range of issues, from bringing pets to work and abusing expense accounts to offensive language, drug use, and alcohol-fueled misbehavior. The findings echo concerns raised in the Treasury Committee’s recent “Sexism in the City” inquiry, which found that an “old boys’ club” mentality persists and that sexual harassment has merely shifted from the office to off-site events.
Firms Rarely Dock Pay, Despite Disciplinary Action
While firms took disciplinary action in most cases of violence, intimidation, and sexual harassment, they rarely hit offenders where it hurts: their wallets. Only 1-3% of misconduct cases resulted in pay cuts, and firms seldom clawed back bonuses. Even when financial penalties were imposed, they often came from future bonuses rather than docking past pay. This kid-gloves approach raises serious questions about the industry’s commitment to creating a safe, equitable workplace.
“We want this data to support financial firms by providing their management teams and boards with an opportunity to consider if they stand out, and, if so, why that might be,” – Sarah Pritchard, FCA Director
Rather than taking direct action, the FCA is leaving it to industry bodies like UK Finance and the Association for Financial Markets in Europe (AFME) to review the findings with their members. While both organizations pledged to work on “enhancing approaches” and developing “industry guidance,” critics may see this as a punt, allowing firms to police themselves despite years of failing to properly address misconduct.
Time for Real Accountability and Change
As the City struggles to shed its reputation as a bastion of privilege and impropriety, the FCA survey serves as a stark reminder of how far the industry still has to go. Meaningful progress will require more than platitudes and self-regulation. It’s time for firms to start hitting offenders where it hurts, docking pay and bonuses and showing zero tolerance for harassment, bullying, and discrimination. Only then can the City hope to build a truly inclusive, professional culture worthy of the public’s trust.
