To send content items to your account,
please confirm that you agree to abide by our usage policies.
If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account.
Find out more about sending content to .
To send content items to your Kindle, first ensure email@example.com
is added to your Approved Personal Document E-mail List under your Personal Document Settings
on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part
of your Kindle email address below.
Find out more about sending to your Kindle.
Note you can select to send to either the @free.kindle.com or @kindle.com variations.
‘@free.kindle.com’ emails are free but can only be sent to your device when it is connected to wi-fi.
‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.
The one bad apple spoiling the barrel has become a common metaphor to describe risk culture in organisations. This ‘inside-out’ perspective begins with the individual as the unit of analysis and follows with inferences to the broader environment. Since the global financial crisis (GFC) of 2008, risk culture for many has become the explanation for shortcomings, poor decisions and moral failures in organisations. We present an institutional perspective of some of the forces that shape risk culture in organisations.
The chapter analyses the role of financial regulation in facilitating the development of organizational norms to enhance risk culture in financial institutions. The paper suggests that shortcomings in risk culture – particularly as understood through the lens of human agency theory – in large financial institutions are the result of collective agency problems. The paper argues that regulation has a role to play in addressing collective agency problems but that regulators should be selective in what tools they use to enhance risk culture in institutions with consideration given to the regulation of remuneration and trusted financial products. It further suggests that to address collective agency problems in large financial institutions policymakers should consider the utility of a senior managers’ liability regime to incentivize senior officers and board directors to be more proactive and aware of misconduct and other behavior that results in agency costs for the firm and society. The paper concludes that a effective regulation involves a balance between official sector regulation and self-regulation that can channel the collective actions of individuals to improve governance and operations in a way that benefits overall firm performance and which mitigates socially costly behavior.
Risk culture warrants a broad and multidisciplinary view. Our authors have provided insights and brought new thinking to this topic as an antidote to approaching the subject with linear thinking and prescriptive solutions. Their chapters provide multiple lenses for understanding and exploring risk culture as an organisational phenomenon.
The one bad apple spoiling the whole barrel has become a common metaphor used with reference to risk culture in organisations. This “inside-out” perspective begins with the individual as the unit of analysis and follows with inferences to the broader environment. Since the Global Financial Crisis (GFC) of 2008, risk culture for many has become the explanation for shortcomings, poor decisions, and moral failures in organisations. This volume presents an institutional perspective of the forces that shape risk culture, and culture more generally, in organisations through a multi-disciplinary examination from a variety of leading academics and subject specialists. The authors demonstrate that firms play a role as manufacturers and managers of risk and they challenge common conceptions that attribute risk to chance circumstances or rogue behaviours. The foundational concepts needed for an institutional view of risk culture are highlighted with subsequent links to significant developments within society and firms.