Its internal diversity climate questionnaire report from September 2008, leaked to a national newspaper over the weekend, unearthed unacceptable behaviour within the FSA.
Although the report suggests that racism is not endemic, it expresses concern that racist behaviour, both by FSA employees and towards FSA employees by others in the industry, went unchallenged.
According to the leak, the report suggests that lower-level staff feel too frightened to speak out while there was “little challenge of inappropriate behaviour” from within the FSA.
This is completely unacceptable. If a culture has developed at the FSA where staff feel unable to highlight examples of racism, then a review of the regulator is needed to address this situation.
Advisers, as well as everyone else in the industry, must be confident in their dealings with FSA staff that their ethnicity plays no part in proceedings.
In response to the leak, the FSA says it does not tolerate discrimination. To prove this the FSA must set out clearly to the industry the steps it has taken, and will be taking, to clean up its act.
The FSA says it is unsure whether the report will now be made public, although a spokeswoman is quoted as saying: “I don’t see why it should be.”
We could not disagree more. Publishing the report will give the industry and the public a fuller picture of the culture which has developed within the regulator and what needs to be done.
Chief executive Hector Sants recently warned the industry to be “very frightened” of the regulator. He needs to ensure that racist individuals within the FSA are the ones that are frightened and weeded out and that a culture exists where other employees are not too scared to speak out against them.