A survey of staff in banks worldwide has revealed that remuneration policy is generally "not favourably perceived" and is the element in bank culture most likely to lead to bad behaviour.A team of academics at the Department of Applied Finance and Actuarial Studies at Macquarie University, led by associate professor Elizabeth Sheedy, has spent the past three years researching risk culture in financial institutions.The research included a survey of staff at 12 banks in Australia, New Zealand, the United Kingdom and Canada. Seven of the banks were described as "very big".Sheedy presented the results of the survey at the Centre for International Finance and Regulation's banking research showcase yesterday. "What we really care about is that we want people to behave well. Culture will drive that," Sheedy said."We can observe a company's governance structures - the proportion of independent directors, the board committees, remuneration policies - but we have to take it further. We have to look at how effective those systems are because adverse culture undermines governance structures."The researchers asked staff what they thought about their bank's training programs, governance frameworks, risk management and remuneration.The first three areas were perceived favourably but remuneration was a negative."In other words, people were telling us that remuneration did not fit with the bank's risk culture objectives," Sheedy said."We have found that where there were negative perceptions there was more negative risk behaviour. People bend the rules."Demand for higher rates of return will prompt unethical behaviour if the targets are too high."Sheedy said responses varied in different business units. "Tone from the top" is an important element in determining culture but not as important as many think."At the local workplace people are interpreting these messages through their local leaders," she said.The researchers also found that senior leaders had a rosier image of the culture of their banks than staff. "That is an avoidance story. Senior leaders are not getting all the bad news."