Financial services firms face culture risk from tech, managing multi-generational workers, study finds
Organisations need to view culture as a strategic imperative, according to Allen & Overy report
Financial services firms’ company culture is under threat from technology and managing a multi-generational workforce, which could pose both regulatory and reputational risk to their businesses, according to a new study from Allen & Overy (A&O).
The ‘Organisational Culture in Financial Services’ report found that 62% of senior leaders at financial services companies believe that new and emerging technology platforms pose the biggest threat to their corporate culture. More than half of respondents also said that managing workers across multiple generations also posed a significant challenge to their culture over the next 12 months.
Sally Dewar, CEO of A&O’s strategic advisory business A&O Consulting, said: “Culture continues to top the agenda of policymakers, regulators and senior boardroom leaders across financial services firms, but the themes identified by this research can apply equally to companies across many sectors. Leadership teams need to continually assess and evolve their approach to organisational culture; the factors influencing culture today are very different when compared with the previous few years.”
Those factors include the post-Covid emergence of hybrid working, a greater focus on diversity and inclusion and the impact of social media on corporate strategy.
The survey found that the maturity of organisational culture is typically determined by how committed senior leadership is to setting the tone from above. Just over half of respondents (56%) said they rated their organisations favourably for encouraging employees to speak up and voice concerns, with only a quarter of respondents rating their senior leaders favourably when it comes to role-modelling expected behaviours.
The report argued that senior leadership need to treat culture as a risk management challenge so they can better assess potential emerging pressure points. Less than a third of respondents (29%) said their firms undertake regular reviews to ensure governance of culture is effective, while just 27% said their firms have systems that provide appropriate insights into organisational culture and risk.
Clive Garfield, executive director at A&O Consulting, said: “Organisations need to position culture as a strategic imperative and embed corporate values to support their business strategies.”
The report was based on in-depth interviews with more than 500 senior executives at financial services firms globally, including banks, insurance companies, asset managers and payment platforms.