Bullying, sexual harassment and other misconduct up at City firms

There has been a rise in reported incidents of bullying, sexual harassment and other forms of misconduct at City firms, according to a wide-ranging survey by the financial regulator that sheds light on the culture of the sector.
Data gathered by the Financial Conduct Authority from 984 firms involved in banking, broking and insurance showed there were 2,347 incidents of non-financial misconduct recorded last year, up from 1,670 in 2022 and 1,363 in 2021.
This equates to 7.2 incidents per 1,000 employees in 2023, 5.1 in 2022 and 4.2 in 2021 based on firms’ aggregate headcount in February this year, with rates highest at wholesale banks. Bullying and harassment was the most reported type of specific incident at 26 per cent, followed by discrimination at 23 per cent.
However, 41 per cent of cases related to other forms of misconduct, beyond specific types such as sexual harassment, drugs and violence and intimidation. This miscellaneous category ranged from misuse of alcohol and use of offensive language to bringing pets to work.
The survey is the first of its kind undertaken by the regulator and comes amid growing scrutiny of working conditions in the City that has been fuelled by scandals including sexual misconduct allegations made last year against Crispin Odey, the hedge fund manager who has denied the claims.
The authority cautioned that it was difficult to draw conclusions from its research because “a high number of complaints could be an indicator of a healthy culture in which people feel they can speak up”. Four per cent of the 1,028 companies originally polled by the watchdog did not respond to its data request, even though its survey was mandatory. The figures for 2021 may also have been affected by Covid restrictions that were still in place, which meant more people were working from home.
Dame Meg Hillier, the chair of the Commons Treasury committee, which has previously looked at sexism in the City, said it would “seek further clarity on this issue when we next invite the regulator to Westminster”.
She said: “On the surface, these latest findings seem to show that far from the City dealing with these issues, it may even be going backwards.”
The regulator is not planning to make new best practice recommendations as a result of its findings. However, it said that companies could use the data as a benchmark for re-examining their own controls and procedures and that industry trade associations had a central role to play in coordinating work.
Forty-three per cent of incidents led to disciplinary or other action being taken, although employee pay was “rarely” docked, the regulator found. The highest proportion of cases that resulted in settlements or confidentiality agreements involved discrimination. It was mostly wholesale banks that used agreements and settlements, although the watchdog also found that there was a general decline in their usage over the three-year period.
Whether or not action was taken varied between types of misconduct, with 62 per cent of discrimination allegations not upheld. The authority said the sector “should reflect on these differing rates and consider whether these are explainable”.
UK Finance, the trade body, said “firms will review and, as required, enhance the approach being taken to dealing with misconduct” and the Association of British Insurers said the survey highlighted “ the need to strengthen governance related to culture”.