“Corporate culture and governance have been central to every crisis involving U.S. business practices over the past century,” said Hamid Mehran, assistant vice president in the New York Fed’s Research and Statistics Group. “Today’s volume identifies and assesses key issues in banking culture and governance. By fostering a better understanding of the factors that drive financial stability, these insights can assist researchers and practitioners as they work to establish a stronger, healthier U.S. and international financial system.” The report is comprised of two complementary parts, according to the New York Fed. Part 1 contains five white papers and explains the concept of culture and its importance to risk management and financial stability, which includes a framework for diagnosing and changing culture, a description of how corporate culture is shaped, an exploration of the importance of effective risk management, and the roles that deferred cash compensation and bank cash holdings play in promoting financial stability. Part 2 of the volume contains four papers and assesses the critical areas of corporate governance, which include the role of the board of directors, the monitoring function of large outside shareholders, the importance of financial disclosure and transparency, and how banks’ disclosure practices and performance are related.