The government plans to scrap what it has branded the "failed" approved person regime in financial services and replace it with a new senior persons regime.
The new regime will apply to persons with responsibility within a firm for managing the business and key risks that the firm faces.
Today's overhaul was announced in the government's response to the parliamentary commission on banking standards.
While the commission's report is most critical of bankers, it goes on to say that it is "plausible that the weaknesses of the approved persons regime affect not just the banking sector but other parts of the financial services industry too".
The government agrees with this assessment - and notes that many of the failures identified by the commission were not limited to the banking sector.
As a result, and because the relevant Financial Services and Markets Act (FSMA) provisions apply to all parts of the financial services industry, the commission and the government have decided that it would be simpler legislatively and operationally to apply any reforms to the framework for regulating individuals to the financial services industry as a whole.
"Low standards of conduct and managerial performance, particularly in relation to risk management, were important contributing factors to the financial crisis," the report said.
The commission also highlighted the role that "inappropriate" remuneration structures have played in encouraging excessive risk taking.
It raised the link between inappropriate remuneration structures for retail staff, and the incentives for this category of staff to engage in inappropriate conduct, such as mis-selling.
The commission has put forward proposals to further improve the alignment of pay incentives with risk and conduct, and the government broadly endorses its approach, the report said.
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