. a strong ethical culture also attracts the best and the brightest personnel, who will seek out the bank as the place to build a career doing high quality work, for fair compensation, with people they like and respect. as for those with whom the bank does business, they may come to see the organization as customer focused, looking to serve them well, and not turning them into the next “ profit opportunity. ” finally, from the perspective of the supervisory community, an industry comprising personnel who have a strong ethical culture will be a safer and sounder industry, certainly safer and sounder than an industry full of miscreants. this could be a powerful factor toward financial stability. thank you for your kind attention. christine lagarde, “ economic inclusion and financial integrity, ” address to the conference on inclusive capitalism, ” may 27, 2014. the archbishop offered these comments at an october 12, 2014 panel discussion that was part of the international monetary fund 2014 annual meetings. a video of that discussion is available at http : / / www. archbishopofcanterbury. org / articles. php / 5426 / archbishop ‐ to ‐ take ‐ part ‐ in ‐ imfworld ‐ bank ‐ panel ‐ onethics ‐ and ‐ finance. notably, the archbishop described his role at the conference as a “ lion in a den of daniels. ” even the skeptics of cultural reform concede that there is “ almost universal accord that remuneration structures contributed to excessive risk ‐ taking in financial institutions and that excessive bonuses paid on anticipated accounting profit at the time of deal origination distorted decision ‐ making and resulted in asymmetric riskholding. ” paradigm risk consulting, to boldly supervise..., february 2014. see dudley, enhancing financial stability by improving culture in the financial services industry, supra n. 4. bis central bankers ’ speeches

should be our goals to meet before the next such conference, to take place in new york in the year 2000? let me begin by saying that the core principles lay out the major highway to effective banking supervision, but do not provide a detailed street plan. one important element of feedback we are receiving from the core principles liaison group, consisting of members of the basle committee and members of the emerging markets, along with more informal feedback, is the need to provide more detailed street plans. there are several ways to achieve that. the first is to continue to elaborate on the core principles by producing papers on key topics to augment and update the compendium. the compendium is the set of relevant papers issued over the years by the basle committee which elaborate further on the core principles and provide the next level of detail. in the past year, for example, we have published papers on internal control systems for banks, interest rate risk management and operational risk that fill in some of the gaps in the compendium related to risk management and internal controls. these were prepared by the risk management subgroup, chaired by roger cole of the federal reserve board and christine cumming of the federal reserve bank of new york. we have work underway now in that subgroup for future papers on supervisory issues in credit risk management, corporate governance and internal audit. as another example, we issued a paper on the framework for enhancing transparency last month. the transparency subgroup intends to build upon that framework, with special emphasis on trading, derivatives and credit risk disclosure. in addition, as noted, we published last week a paper on loan valuation and loss reserves. this probably is still not enough detail for many supervisors. the need for more detail may be better met through increased technical assistance provided by the basle committee on banking supervision, along with similar assistance programs of its individual members. moreover, the international monetary fund, the world bank, and regional development banks have stepped up their efforts to provide technical support as well. often, the detailed street plan can be developed only with very specific knowledge of the marketplaces, banks ’ powers and roles in the financial system, and the laws and regulations of the country in question. local supervisors and outside technical experts can work together to fashion specific supervisory guidance and regulation that are appropriate in the local marketplace. additional resources are available from the institute on financial stability, a joint effort of the g - 10 central bank governors, the basle committee, the international organization of securities commissions ( known as iosco