The financial services and energy industries have much in common. They are both capital-intensive, involve huge risks and complex regulation, and the rewards for those who get it right are often mind-boggling. But if they get it wrong, it is more than just the companies, their bosses and their investors who suffer. Quite often, innocent bystanders such as consumers and tax payers also have to bear the brunt of the follies of a few. For every Lehman Brothers in finance, you can almost always find a Deepwater Horizon oil spill in energy.

Given the similarities between the two industries, we decided to survey C-level executives from both industries to find out what accountability means to them. Comparisons between the two sets of responses provide some eye-opening insights.

One key difference between business leaders from the financial services sector and the energy and utilities industries is the way in which they view the concept of accountability—and its consequences—to various stakeholders. Only 13% in the financial services sector believe that frequent failure to be accountable might cost them their job, but almost twice as many (25%) in the energy and utilities industries think it could cost them their job. Similarly, only 7% of financial services respondents think that any failure in accountability could result in a job loss, compared with 12% of executives in the energy and utilities sector (see chart). 

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Sunil Misser, the chief executive of AccountAbility, a research and advisory firm, believes that there are a couple of fundamental structural differences between the sectors which might explain such a finding. One is what he considers to be the differing external view of the respective dynamics of the two industries.

"The world of finance is perceived as one overall 'system', with all companies lumped together in this perception," he says. "Executives therefore find it easier to evade criticism by blaming an intangible market. This clearly does not encourage true accountability. It’s much more difficult to transfer blame to the overall 'market' for, say, a failure of health and safety procedures in the upstream energy sector. When BP spilled a lot of oil in the Gulf of Mexico, they were singled out as the bad guys."

Mr Misser also believes that true executive accountability is harder to establish in financial services because there is little consensus on what precisely executives should be accountable for: "There is a much more widely shared and clearer vision on the future of accountability in the energy sector—for example, there are accepted targets for renewable energy and reductions in emissions."

To read more on accountability in the financial services sector, check out our latest report Society, shareholders and self-interest.