Starling CEO Stephen Scott along with Starling Advisors Nicholas Christakis, Mirea Raaijmakers, and Martin Wheatly cowrote an article for Thomson Reuters Regulatory Intelligence titled “A Copernican Revolution in Culture and Conduct Risk Management”. The authors argue that traditional means of managing culture and conduct risk rely too much on outdated theories about employees behaving as rational actors. As a result, the mechanisms that firms use tend to rely heavily on a rules-based approach leveraging employee surveys and training as a means to encourage compliance.

In actuality, employees operate in complex environments where group norms and witnessed behavior can easily overwhelm the ‘tone from the top’. In this environment, new tools are required that can make sense of these complex systems and guide managers to more effective interventions.

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