Sants calls for urgent action on corporate governance failings

Poor corporate governance in banks must be "urgently" addressed as it can ultimately lead to their failure, said Financial Services Authority (FSA) chief executive Hector Sants.

In a speech today, the outgoing FSA chief said the financial crisis had exposed "significant shortcomings" in the governance and risk management of banks and added the regulator needs to address the lack of "technical skills" in boardrooms. "Management are responsible for running firms and ultimately firms fail because of the decisions taken by their boards and their management," he said. "These decisions are made within a firm's corporate governance framework." He said shortcomings in the risk management of firms, along with the culture and ethics underpinning them, are not struct...