2014 alone saw the collapse of Espirito Santo bank in Portugal; corruption scandals in Brazil’s state oil company Petrobras and investigations of insider-trading at France’s BNP Paribas. While in the US, the SEC is investigating improper fees charged by private equity advisers, and five major US banks agreed to pay $4.3 billion to settle charges of systematically manipulating the foreign currency markets, with criminal prosecutions still a possibility.

That list alone should make it clear that recent scandals and the regulatory reforms they provoked have not sufficiently changed how participants in the financial industry conduct their business. A year ago, CFA Institute observed that for the general public, bankers and other fiduciaries bring to mind Jordan Belfort in The Wolf of Wall Street, and not George Bailey, the humble protagonist of it’s a Wonderful Life. The global financial industry can be an extraordinary force for good, facilitating the efficient exchange of capital to help the economy and stimulating society, but to the outside, financial industry players seem to think only of self-dealing, dishonesty and corruption.

As participants in that industry, we’re doing the public — and ourselves — an injustice if we write the litany of scandals off as “just a few bad apples” or even worse, as the price of doing business. Trust, not cash, is the fuel that makes the financial system function, and when investors, big and small, start to see the system as one rigged against them, the risk of collapse will never be far away.

Acting on this belief for the past four years, CFA Institute has conducted a Global Market Sentiment Survey (GMSS) to invite the insights and perspectives of our members globally — respected industry experts — on the economy, market integrity, and their expectations for the coming year. Globally, 28 per cent of respondents indicated that improved regulation and oversight of global systemic risk is the action most needed to help improve investor trust and market integrity. A higher proportion of members in Asia-Pacific (40 per cent) than in Europe, the Middle East, and Africa (29 per cent) and the Americas (23 per cent) indicated this.

In Europe, Middle East and Africa, proportionately more, members point to a lack of ethical culture within financial firms as the factor that has contributed most to the current lack of trust. Where the need for improved transparency of financial reporting and other corporate disclosures was cited by 21 per cent of members as the most important action needed to restore trust and market integrity. A higher proportion of members in the Americas (26 per cent) than in both Europe, the Middle East, and Africa (16 per cent) and the Asia-Pacific region (15 per cent) indicated that this was a top concern. This finding is consistent with the recent study sponsored by CFA Institute; A crisis of culture: valuing ethics and knowledge in financial services, an EIU report which flags continued discordance within financial firms between high ethical standards and managerial career progression.

So what can be done, and who needs to do it?

• Globally regulators and policymakers need do a more effective job managing risk. Our members indicated that improved regulation and oversight of global systemic risk (28%) was the regulatory or industry action most needed in the coming year to help improve investor trust and market integrity. Feedback from different regions suggests that in the six years since the global financial crisis, the degree of cross-border cooperation between regulators with regard to detecting and mitigating systemic risks does not yet appear to be sufficient.

• For the third consecutive year, members have said that local regulators have to step up their enforcement of existing laws and regulations.

• Industry participants must improve transparency of financial reporting and other corporate disclosures

• Banks must do a better job managing risk, and they must be required to impair troubled credit holdings on a more consistent and timely basis.

A renewed commitment to ethical conduct won’t make people see investment and financial professionals as modern-day George Baileys, but it’s the best way to ensure the integrity of the financial markets. Ethics is not a luxury, it’s a necessity.

— The writer is managing director of the Standards and Financial Market Integrity division of CFA Institute,