When financial firms adopt a reckless attitude to risk-taking this behaviour can, at worst, lead to a systemic crisis that threatens to destabilise regional and global economies, as we discovered in the 2008 financial crisis.

Even if systemic contagion is averted, such risk-taking can lead to fraud, firm failure, investor loss and wreak substantial economic damage.

Understandably then, a raft of regulatory and legislative measures have been imposed in the hope of preventing this type of behaviour. The costs of creating, implementing, monitoring and enforcing these measures, both at the firm and industry level, are considerable.

Yet, when it comes…

Warwick Business School

Warwick Business School, located in central England, is part of the University of Warwick and one of the world’s leading business schools

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store