Key themes

Professional or private?

NFM is difficult to define.

There are important questions about the extent to which conduct in an individual’s private life might impact their professional life – and in some cases it can be difficult to distinguish the two (such as when socialising with colleagues).

Firms face challenges in considering questions of integrity, fitness and propriety, and making such assessments by reference to the extent to which the misconduct engages the relevant regulator’s rules.

When is NFM a financial regulatory issue?

Most jurisdictions consider that conviction for a criminal offence (involving financial or non-financial misconduct) should impact on fitness and propriety.  Outside of this, to the extent that they seek to assess fitness and propriety, many financial regulators will only look at financial misconduct or misconduct ‘in role’.

That said, we are seeing a growing appreciation of the link between an organisation’s culture and the likelihood of conduct failings – and a move towards a broader approach to what is considered relevant to the “suitability” of an individual for a role.

Well-developed whistleblowing protections

Whistleblowing regimes are well established in all the jurisdictions we surveyed.

The majority have rules under general law which cover all corporates.  Many jurisdictions also have whistleblowing regimes specific to financial services.

Firms must be alive to differences between general protections and those that are specific to financial services and ensure compliance with both.