Log in
The Personal Finance Research Centre (PFRC) at the University of Bristol conducted research between 2004 and 2006 to develop the UK's first quantitative baseline survey of financial capability. The survey was a significant departure from previous methodologies in that it not only assessed knowledge, but also skills and behaviours. The survey results became the basis for the Financial Services Authority's (FSA) understanding of financial capability in the UK, and PFRC's analysis of the survey findings were used to set priorities for its National Strategy for Financial Capability, worth £90 million. One of the findings of the survey was that young people are much less financially capable than their elders. As a result, a priority within the National Strategy was to educate young people. A number of programs were put in place including Learning Money Matters, which offered free advice, support and resources to schools between 2006 and 2011. The program successfully reached over 2 million young people in 4,259 schools, and in 2011 economic wellbeing and financial capability became a statutory part of school curriculum in England. Overall, the FSA strategy was deemed successful, exceeding its target of reaching 10 million people. International bodies regard the FSA's baseline survey as a model for their own work and the UK methodology has been adopted by countries including Ireland, Canada and the Netherlands. The World Bank has led a substantial research and evaluation programme in low and middle income countries that uses the UK approach.
The Personal Finance Research Centre (PFRC) at the University of Bristol conducted a major research programme that shaped UK financial inclusion policy and informed research and policy internationally. PFRC carried out seminal research to measure the level and nature of financial exclusion in the UK. Subsequent studies looked at ways of improving access to banking, credit, insurance and savings that could reduce the `poverty premium' paid by low-income households. PFRC's research directly informed UK central government policy which resulted in the successful achievement of a shared government-banking industry target to halve the number of adults in households without a bank account (from two million to 890,000) and funding to extend affordable credit union loans and savings products to an additional one million low-income people.
As part of our commitment to public sociology (see REF3a), we have prioritised making Edinburgh sociological research on financial crises available to wider audiences: financial practitioners, policy makers and interested members of the general public. This has been primarily via six essays by Donald MacKenzie in the London Review of Books (LRB) and two invited articles in the Financial Times, listed in section 5.3. The impact of this research is in enhancing cultural understanding of finance and contributing to critical public debate. Evidence of its significance and reach includes: (a) public recognition (eg Prospect magazine naming MacKenzie amongst the 25 intellectuals with most impact on the "public conversation" about the financial crisis); (b) articles by others in prominent sources (the Financial Times and Economist) drawing on his work; (c) use of the Edinburgh University research in a major US corporate lawsuit; (d) reprints of the LRB articles eg in French and German public affairs magazines, in the booklets accompanying a Swedish exhibition and a Belgian art video, and in two financial-practitioner magazines.
This case study looks at the impact on the international finance industry and big business of research conducted at Heythrop College by Catherine Cowley. Cowley's work is transforming the ethical framework with which some of the most powerful corporations in the world operate and how they understand their role in society, as well as influencing the direction and content of the public debate over the ethics of finance and business.
Loughborough University research into financial regulation has had a significant and enduring influence on how regulatory bodies are structured and how they use economic analysis. This work has been credited with shaping the groundbreaking culture and methodology of financial regulation in the UK with respect to consumer protection, recognising the special characteristics of retail financial products and contracts and applying cost-benefit and regulatory impact analysis in decision-making processes. It has also played a major role in redefining financial regulatory structure in the UK and South Africa. In addition, the research is now being used to help develop and guide approaches to ensuring high standards of bank regulation and consumer protection across the EU through the European Banking Authority's Banking Stakeholder Group.
A body of research has informed government bodies, policy makers and other agencies on consumer interactions with retail financial services markets. Specifically, it has informed formulation of new policies in the area of simple products and banking standards that are now being put into effect as new policy initiatives.
The impact detailed here has been on policy development and implementation in the area of consumers and financial services. The body of academic research has gained traction and credibility with relevant stakeholders due to academic endorsement and wide scale dissemination efforts. This has allowed researchers a significant input into consultation processes, campaigns and a parliamentary commission. Such inputs have helped formulation of new policies in the area of simple products and banking standards that are now being operationalized as new policy initiatives. Thus, a direct chain of impact exists between the initial research and the final outcomes, which influences numerous financial services decision makers and banking customers.
Research on International Financial Reporting Standard 8 `Operating segments' (IFRS8), undertaken by academics in the University of Dundee's School of Business, has been used to frame the international debate concerning listed company reporting of disaggregated (segmental) information about business unit and geographic activities. Three bodies involved in regulation and compliance, have drawn on the research to inform their positions and strategies in relation to the standard. Firstly, the IASB's review of IFRS8 was informed by the research. Secondly, the key findings were fed into the Financial Reporting Council's proposals to amend IFRS8. Thirdly, the research underpinned the Institute of Chartered Accountants of Scotland's (ICAS) response to the IASB's request for information on how the standard was being applied, what challenges were encountered and associated costs.
This case study refers to the work of Professor Thankom Arun of the Institute of Global Finance and Development (IGFD) at UCLan, who has been working very closely with Microfinance Institutions (MFIs) and international development agencies to understand and tackle the critical issue of finance in the development process. The ingenuity and originality of this type of research has had a profound impact on national and international policy debates, challenging and disproving misunderstandings about the inability of the poor to engage effectively with financial services provision, such as savings and insurance. The research has had a significant direct impact on the functioning of microfinance institutions at the local and grassroots level and on the delivery of financial services to some of the most vulnerable communities around the world.
Research undertaken at the University of Manchester (UoM) has contributed to the development of a new interdisciplinary field, `Mathematical Behavioural Finance' (MBF), that deals with mathematical models of financial markets based on behavioural principles. These models go far beyond the conventional paradigm of fully rational utility maximization, and reflect a whole variety of patterns of market behaviour. A particular emphasis is on evolutionary aspects: growth, domination or just survival, especially in crisis environments.
Impacts can be seen in investment strategies based on MBF that have been successfully employed in large scale funds, since 2008, by Swiss and German corporate investors (AllMountain Capital AG and Deutsche Bank). These strategies have demonstrated high rates of return combined with relatively low volatility, coping exceptionally well with one of the most severe financial crises in recent history.
Since the global financial crisis triggered by the collapse of the subprime mortgage market in the United States, a key issue for central banks has been the extent to which they should use monetary policy, along with macroprudential tools, to promote financial stability. University of Manchester (UoM) research has developed small theoretical models, and more detailed quantitative macroeconomic models, to help address this issue. This analytical work has helped to: firstly, influence the policies and operations of several major central banks (Brazil, Turkey and Morocco); and secondly, fuel the debate about global reform of bank regulation in international forums, such as the Financial Stability Board, the Basel Committee on Banking Supervision and annual meetings of central banks from Latin America. Impact has been achieved through presentations to these forums, alongside discussions with senior policymakers from other countries.