Financial institutions face a critical misconduct management gap that creates substantial risk exposure increasingly difficult to defend during regulatory examinations.

The traditional binary approach to addressing non- financial misconduct (NFM) has created a structural weakness. When NFM occurs, many cases are threshold misconduct - conduct issues that fall between "ignorable" and "fireable". Firms have few options for response to these threshold misconduct cases.

Beneath these visible problems lies a more fundamental issue: firms have confused responding to misconduct with remediating it.

The real issue isn't that firms lack policies or procedures around misconduct, there can be a lot in place. What's missing isn't just a middle-ground response, it's an intervention designed to actually change behaviour, not simply capture and record that something was done.

So, we have developed the Conduct Compass, a remediation, non-native strategy based on behavioural science's demonstrated behaviour change strategies.