The former head of the China Securities Regulatory Commission (CSRC) has called for stepping up regulation of the ethical conduct of the domestic fintech sector at the 2022 meeting of the Chinese congressional bodies.
Xiao Gang (肖钢), former CSRC chair and currently a member of the Chinese People’s Political Consultative Conference (CPPCC), has submitted a bill to the 2022 March meeting of the CPPCC calling for the establishment of a “fintech ethical governance system.”
“Fintech ethical omissions have led to discrimination in financial services and trigger loss of confidence in finance, which can create many serious perils such as market monopolies and unfair competition,” said Xiao in an interview with 21st Century Business Herald.
“The root cause of these issues lies in weak understanding of tech ethics.”
In order to deal with these issues Xiao Gang’s bill contains a total of 7 proposals, including:
- The establishment of a national fintech ethical commission led by the Chinese central bank.
- The establishment of bias control mechanisms for tech applications.
- Prevention of discriminatory services for certain consumer demographics.
- Arranging for financial institutions and tech companies to engage in self-assessments.
- The inclusion of ethics within the comprehensive risk management and internal control procedures of companies.
- Encouraging large-scale financial institutions with complex technologies to establish the position of “Chief Ethical Officer.”