Predict360 Regulatory Change Management
Presidential elections are always a cause for concern for the banking industry, but things have not been as concerning in the past few decades as they are right now. There are many industries which are severely impacted by elections.
These are industries which have partisan support, which means that the regulatory outlook for them completely depends on who wins the elections. Banking has, historically, not been such an industry. It is one of the few sectors of the economy which enjoys a good relationship with both the Republican and Democrat leaders and influencers. This means that when it comes to regulatory change management, the elections are consequential but not severely.
We saw this in the 2016 elections. While President Trump and Hillary Clinton had opposing viewpoints about most domains, banking was not a point of contention between them. Neither Trump nor Hillary campaigned against the banking industry. Hillary Clinton even risked some of her political goodwill by giving speeches to bankers behind closed doors. There are some landmark banking regulations which have partisan support, but none of the parties have supported taking any drastic steps to change the banking industry.
Image Courtesy: Credit Union Times
Why 2020 presents a unique challenge for regulatory change management
The 2008 financial crisis was a watershed moment for the banking industry. There was a lot of anger against banking institutions and CEOs. The huge bailout only furthered these sentiments amongst the people. However, since both the major political parties in the country stood together to help keep the banking industry intact and the economy afloat, this anger was not utilized or released. The problem is that the current Democrat strategy is to look at what went wrong with their campaign in 2016 and ensuring that the same mistakes are not repeated. The party’s support for the banking industry is also being reexamined, which has vast ramifications for regulatory change management.
The candidates who have announced that they are running know that they need to capitalize on the sentiments of the people to succeed. The pleas to rationality and sensibility in 2016 resulted in failure – the focus is now to use passion similar to how the Trump campaign used passionate voters to win. The banking industry has become an easy target during these circumstances. Out of all the people who have announced their candidacy to be the candidate against Trump, there are no major supporters of the banking industry. There are a few Democratic leaders who are closely tied with the banking industry, but they have not announced a run for the presidency.
Have a look at how our automation based regulatory change management tools help your organization achieve better compliance levels at a faster pace across the organization.
Bernie Sanders and Elizabeth Warren are the two most well-known people running for president, and both of them are famously against big banks. Elizabeth Warren made a name for herself fighting big corporations and Bernie Sanders is known mostly for his socialist ideas. The other candidates are not against big banks, but they can read a room – they know how much people love it when Bernie Sanders and Elizabeth Warren talk against big corporations, and it is safe to assume that they will take a similar approach towards things.
Does this mean that all bankers should start campaigning for the Republicans? No, because it will not work. Since the banking industry had bipartisan support, it was never used as a battleground by any of the parties. So while none of them primed their supporters against the banking industry, none of them were primed for the banking industry either. Both parties also tend to support industries which their supporters work in. The oil and gas industry and the agriculture industry both create lots of local jobs, which is why they have so much support among people.
Banks, on the other hand, do not create local jobs, which is why people do not support the industry. Thus, the Republicans will not want to become vocal banking industry supporters either, because they know it may hurt their image.
What does this mean for people in charge of regulatory change management? 2020 is going to be one of the most unpredictable elections ever. It is possible that the Republican candidate wins and supports the banking industry, but it is also possible that even the Republican candidate does not provide much support after winning. The Democrat candidates are vocally against the banking industry. The only solution is to be ready for change, with a regulatory change management system implementation that helps your business quickly adapt.