Post-Brexit Britain and the pay culture: challenges and opportunities

This paper examines the impact of Brexit on financial services regulation in relation to three areas linked to executive remuneration. They are: the bonus cap; the clawback of pay; and the level of disclosure required by shareholders with regard to details of directors’ remuneration. It will be argued that legally Brexit will have little impact on any of the three areas. UK legislation has already incorporated a great deal of EU legislation. The status quo of retaining such legal restrictions seems sensible in light of public sentiment towards unfairness in executive compensation and uncertainty towards the Brexit negotiations. Nevertheless, London faces stiff competition from other major international financial centres in a post-Brexit era. The loss of single passporting rights is also encouraging major banks to invest in other European financial centres. Brexit creates opportunities too. With the integration of digital technology, it is possible to create convenient platforms where investors can access reports on executive remuneration

Regulation and corporate governance : a case study of the UK banking industry

Financial stability remains a key theme in UK financial regulation. This thesis investigates important issues of financial regulation revealed in the financial crisis of 2007-2009. It will analyse macro and micro prudential regulatory weaknesses in UK financial regulation in light of the financial crisis of 2007-2009. The structure of the new ‘twin-peaks’ model in the UK will be compared with the Australian ‘twin-peaks’ model. There are concerns that the Bank of England might have too much power and is thus a super single financial regulator in the ‘twin-peaks’ model. The author will compare the new ‘twin-peaks’ model with the German regulatory structure, where some similarities are found due to the sharing of supervisory responsibilities between the regulatory bodies in both jurisdictions. As far as the author is aware, there is a gap in the literature because the ‘twin-peaks’ model in the UK only came into existence in April 2013 and the literature in comparing this model with the Australian and German models is scarce. The thesis adopts a doctrinal, comparative case study approach, as well as a quantitative analysis of the important financial ratios of four major UK banks and four major Australian banks. The thesis will reveal that the Financial Services Authority (FSA) failed to supervise banks such as Northern Rock, Bradford & Bingley and HBOS properly. The main regulatory and supervisory failures of the FSA are due to organisational and management problems. With regards to the statutory provisions on banking regulation, the Financial Services Markets Act (FSMA) 2000 is complicated, with standards and principles underpinning the FSA’s statutory core objectives. The FSA’s remit is too wide. It is responsible for regulating banks, deposit-taking institutions and insurance companies. With the development of complex products, increased use of securitisation and merging of financial services offered to customers, the tripartite system increasingly found it difficult to delineate their scope and responsibility. Overall, the FSA’s passive, non-interventionist and laissez-faire regulatory approach led to criticisms that its measures were too late and too little. In comparison to the big four Australian banks, the thesis revealed that the big four UK banks had on average, higher cash ratio, higher leverage ratio, higher loan to deposit ratio, higher capital ratio, lower asset quality, lower return on assets but higher return on equity than the big four Australian banks. There is gradual convergence between the UK and Australian prudential supervisory models although there are still some differences between the two models. Financial stability is enshrined in both countries’ legislation and is a key priority after the financial crisis of 2007-2009. Both regulators reject a ‘zero-failure’ regulatory policy. The Prudential Regulatory Authority (PRA) shares the Australian Prudential Regulatory Authority’s (APRA) opinion that it is impossible to prevent all bank failures. Therefore, with the Special Resolution Regime contained in the Banking Act 2009, the PRA’s role is to minimise the systemic effect of any bank failure. The PRA’s supervisory style is based on judgement; risks; forward-looking and early intervention. This is very similar to APRA’s. PRA’s risk assessment framework and its supervisory responses based on the Proactive Intervention Framework. Yet, there are differences between the prudential regulatory and supervisory systems between Australia and the UK. The UK legislative framework is more complex than the Australian framework. Further, the PRA has policy setting powers although the vertical integration of financial regulation at European level may suggest that the PRA is unlikely to exercise this power very often. APRA on the other hand, does not have such wide policy setting powers. The UK Risk Assessment Framework takes more mitigating factors into account. Its Proactive Intervention Framework has five stages and early intervention is clearly a priority for the PRA, since it can start planning for resolution of an organisation even at stage 1. This is in contrast to the Australian SOARS methodology, where there are only four stages and resolution of an organisation takes place in the later stages. There are fears that the new structure within the Bank of England will make it a super single regulator. The thesis will compare the ‘twin-peaks’ model with the German regulatory structure since there are similarities in the sharing of supervisory responsibilities between the UK and German models. The thesis will then make several recommendations on how this concentration of power can be addressed

A Blended Value Proposition: Towards a Regional Sustainability Entrepreneurial Ecosystem Framework for the Social Solidarity Economy (SSE)

This extended abstract has been submitted for the Faculty of Business and Law Research Day 2022

Post-Brexit Britain and the pay culture: challenges and opportunities

This paper examines the impact of Brexit on financial services regulation in relation to three areas linked to executive remuneration. They are: the bonus cap; the clawback of pay; and the level of disclosure required by shareholders with regard to details of directors’ remuneration. It will be argued that legally Brexit will have little impact on any of the three areas. UK legislation has already incorporated a great deal of EU legislation. The status quo of retaining such legal restrictions seems sensible in light of public sentiment towards unfairness in executive compensation and uncertainty towards the Brexit negotiations. Nevertheless, London faces stiff competition from other major international financial centres in a post-Brexit era. The loss of single passporting rights is also encouraging major banks to invest in other European financial centres. Brexit creates opportunities too. With the integration of digital technology, it is possible to create convenient platforms where investors can access reports on executive remuneration

A sampling method for quantifying the information content of IASI channels

There is a vast amount of information about the atmosphere available from instruments on board satellites. One example is the Infrared Atmospheric Sounding Interferometer (IASI) instrument, which measures radiances emitted from Earth’s atmosphere and surface in 8461 channels. It is difficult to transmit, store, and assimilate such a large amount of data. A practical solution to this has been to select a subset of a few hundred channels based on those that contain the most useful information. Different measures of information content for objective channel selection have been suggested for application to variational data assimilation. These include mutual information and the degrees of freedom for signal. To date, the calculation of these measures of information content has been based on the linear theory that is at the heart of operational variational data assimilation. However, the retrieval of information about the atmosphere from the satellite radiances can be highly nonlinear. Here, a sampling method for calculating the mutual information that is free from assumptions about the linearity of the relationship between the observed radiances and the state variables is examined. It is found that large linearization errors can indeed lead to large discrepancies in the value of mutual information. How this new estimate of information content can be used in channel selection is addressed, with particular attention given to the efficiency of the new method. It is anticipated that accounting for the nonlinearity in the channel selection will be beneficial when using nonlinear data assimilation methods currently in development

Binding partners for the COOH-Terminal appendage domains of the GGAs and gamma-adaptin

The adaptor appendage domains are believed to act as binding platforms for coated vesicle accessory proteins. Using glutathione S-transferase pulldowns from pig brain cytosol, we find three proteins that can bind to the appendage domains of both the AP-1 gamma subunit and the GGAs: gamma-synergin and two novel proteins, p56 and p200. p56 elicited better antibodies than p200 and was generally more tractable. Although p56 and gamma-synergin bind to both GGA and gamma appendages in vitro, immunofluorescence labeling of nocodazole-treated cells shows that p56 colocalizes with GGAs on TGN46-positive membranes, whereas gamma-synergin colocalizes with AP-1 primarily on a different membrane compartment. Furthermore, in AP-1-deficient cells, p56 remains membrane-associated whereas gamma-synergin becomes cytosolic. Thus, p56 and gamma-synergin show very strong preferences for GGAs and AP-1, respectively, in vivo. However, the GGA and gamma appendages share the same fold as determined by x-ray crystallography, and mutagenesis reveals that the same amino acids contribute to their binding sites. By overexpressing wild-type GGA and gamma appendage domains in cells, we can drive p56 and gamma-synergin, respectively, into the cytosol, suggesting a possible mechanism for selectively disrupting the two pathways

Retail ring-fencing of banks and its implications

Financial stability remains a key theme globally in view of the Euro zone debt crisis. The latest strategy by Germany and France is to ring-fence the crisis among the PIIGS countries (Portugal, Greece, Ireland, Italy and Spain). In the United Kingdom, the big four major banks have all responded to the Independent Commission of Bankings interim report key recommendation: ring-fencing retail operations into a separate subsidiary of any bank that wishes to operate in the United Kingdom. The report has clearly discussed the advantages and disadvantages of various types of subsidiarisation. Retail ring-fencing is considered a compromise as full subsidiarisation is too costly and operational subsidiarisation is too minimal. The Independent Commission of Banking published its final report on 12 September 2011. They recommended ring-fencing retail banking and a 10 per cent equity baseline. This article focuses on structural reforms of UK banks. It aims to address the question of financial stability from a wider European perspective. The first question is whether cross-border retail banking in the European Economic Area (EEA) is best served by branches or subsidiaries? The second question concerns the legality of setting up subsidiaries in the European Union (EU). Although there are no legal problems for UK-based banks setting up subsidiaries for their retail activities, there might be a legal hurdle for requiring foreign banks setting up subsidiaries in the United Kingdom. The third question concerns EU cross-border banking regulation and supervision. Are the passporting system and the home country supervisory approach still applicable in this post-financial crisis era? Many factors influence the choice of setting up branches or subsidiaries. However, the general position is that branches are more suited for wholesale/investment activities because of ease of funds transfer. Subsidiaries are more suitable for retail banking because of the limited liability principle and extensive local network. Effective cross-border banking must be accompanied by effective supervision and resolution regimes. The passporting concept under EU law and home country dominance are somewhat dated post-financial crisis. Host country control should play a dominant part in financial regulation, especially in the light of the importance of subsidiaries and the limited liability principle associated with them. The Icelandic bank crisis and collapse of Lehman Brothers International Europe illustrate the importance of host country control. Finally, the author argues that requiring banks to hold its retail activities in the form of subsidiaries in another European country is necessary to achieve financial stability. © 2012 Macmillan Publishers Ltd

Greed, recklessness and/or dishonesty? An investigation into the micro-regulation and culture of five UK banks between 2004-2009

The author uses a multiple case study approach to examine five UK banks in her paper. The banks are Northern Rock, the Royal Bank of Scotland, Barclays, Lloyds Banking Group and HSBC. The author feels that it is appropriate to use a multiple case study here because it will be interesting to study the micro aspects of regulation and corporate governance of five UK banks. The banks have to comply with the same regulations and laws on a macro level, so it is essential to examine the differences between these banks on a micro level through reviewing annual reports and financial ratios. The case study is longitudinal, spanning across 2004-2009. In accordance to the aims of a case study, the author will describe, understand and explain the effects of the financial crisis 2007 on five UK banks. This case study provides an opportunity to examine the weaknesses and failures of corporate governance of five UK banks at a micro level. The author has two hypotheses at the beginning of the study. First, banks moved from a customer driven culture to sales driven one. Secondly, the banking culture during between 2004-2009 is one of greed, recklessness and dishonesty. With the caveat that one should not make generalisations, there is evidence from the case study that both hypotheses are correct to a certain extent

Infected pancreatic necrosis: outcomes and clinical predictors of mortality. A post hoc analysis of the MANCTRA-1 international study

: The identification of high-risk patients in the early stages of infected pancreatic necrosis (IPN) is critical, because it could help the clinicians to adopt more effective management strategies. We conducted a post hoc analysis of the MANCTRA-1 international study to assess the association between clinical risk factors and mortality among adult patients with IPN. Univariable and multivariable logistic regression models were used to identify prognostic factors of mortality. We identified 247 consecutive patients with IPN hospitalised between January 2019 and December 2020. History of uncontrolled arterial hypertension (p = 0.032; 95% CI 1.135-15.882; aOR 4.245), qSOFA (p = 0.005; 95% CI 1.359-5.879; aOR 2.828), renal failure (p = 0.022; 95% CI 1.138-5.442; aOR 2.489), and haemodynamic failure (p = 0.018; 95% CI 1.184-5.978; aOR 2.661), were identified as independent predictors of mortality in IPN patients. Cholangitis (p = 0.003; 95% CI 1.598-9.930; aOR 3.983), abdominal compartment syndrome (p = 0.032; 95% CI 1.090-6.967; aOR 2.735), and gastrointestinal/intra-abdominal bleeding (p = 0.009; 95% CI 1.286-5.712; aOR 2.710) were independently associated with the risk of mortality. Upfront open surgical necrosectomy was strongly associated with the risk of mortality (p < 0.001; 95% CI 1.912-7.442; aOR 3.772), whereas endoscopic drainage of pancreatic necrosis (p = 0.018; 95% CI 0.138-0.834; aOR 0.339) and enteral nutrition (p = 0.003; 95% CI 0.143-0.716; aOR 0.320) were found as protective factors. Organ failure, acute cholangitis, and upfront open surgical necrosectomy were the most significant predictors of mortality. Our study confirmed that, even in a subgroup of particularly ill patients such as those with IPN, upfront open surgery should be avoided as much as possible. Study protocol registered in ClinicalTrials.Gov (I.D. Number NCT04747990)