Following the winding down of the Financial Services Authority (FSA), it is essential that any newly-formed regulators "stand their ground" and ensure that conduct is upheld in the sector.
That is the opinion of Hector Sants, current chief executive of the FSA, who was speaking at the organisation's annual public meeting and said that firms should recognise that the regulator's "intensive supervisory approach" will continue into the new organisational framework.
"As we move out of this crisis there will be calls for regulators to revert to light touch regulation, and senior management will be less willing to listen to a regulator who could be seen to be ‘second guessing' management," he explained.
When this happens, Mr Sants said regulators must continue to be proactive, though this will require the support of government and society as a whole.
It comes after Mr Sants said he would "strongly advocate" intervention in the UK through changing the Companies Act framework for directors, as the current requirement for directors to promote the success of the company is often interpreted in terms of shareholder value.
Posted by Claire Robin