We've been speaking about banker ethics that week, though it is still unclear what, exactly, supervisors want when they call for it.  Maybe the network-of-regulatory-networks the Financial Stability Board will come up with an answer.  The G-7 has just asked it to develop a code of ethics that would apply to all of the banks across the world.

“This kind of malpractice has got to do with the dominant company culture but not just that -- it’s also about the behavior of individuals, who should not be absolved from responsibility,” Bundesbank President Jens Weidmann said in the German city of Dresden on Friday, announcing the G-7’s lead. The code “should be a voluntary self-commitment made by the financial industry, an international initiative,” he said.

...

“Currently a certain number of disparate codes exist in different jurisdictions, and they were often ignored,” Banque de France Governor Christian Noyer said after the Dresden meeting. “We need to pull all this together, so that we have a code that is coherent and applicable everywhere.”

It will be interesting to see how voluntary this voluntary code is.  And how the FSB is going to harmonize the cultures of, say, Japanese conglomerates and American four branchers.  But it is either an example of how financial regulation is increasingly done at the global level ... or an example of regulators saying: we give up!  All our rules are meaningless!  Please be nicer!

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