Trust, control, and cooperation have always had special meaning in the financial services industry (FSI). Trust is the “lubricant” of the industry, control is the safeguard that this trust will not be misused, and cooperation between banks is a precondition for them to function. Banks need each other to fulfil their joint role as the financial infrastructure of society. The importance of these concepts is only increasing, given various developments within the FSI. Cooperation that occurs across the boundaries of organizations, so-called interorganisational relationships (IORs), has become business as usual for many financial institutions (FIs). Sourcing models like outsourcing and alliances are common practices nowadays.

At the same time, the importance of formal control mechanisms like contracts, rules, and regulations has also appeared to increase in the FSI since the last financial crisis. Supervising authorities are very eager to prevent another collapse of the financial infrastructure, as happened during the crisis that started in 2007. Many decision makers within FIs feel that they are being confronted with an increasing amount of strict rules and regulations. Such dynamics have resulted in a recalibration of the use of trust and control as mechanisms to govern cooperation, not only within organizations but also across the boundaries of autonomous entities. This combination of an increase in both the importance of IORs and the importance of formal control mechanisms has made the following question more relevant: How can formal control mechanisms best be used to benefit fully from the potential of cooperation across the boundaries of organizations? Petrosjan Damen aimed to help practitioners answer this question by studying the governance of five IORs between FIs. The cases he studied focused on cooperation in the operations domain (back office) of FIs, which explains the title of this book. Based on not only the results of his research, but also on his extensive experience as a management consultant within the FSI, Petrosjan advises practitioners to shift their focus from a compliance view to a reliance approach, combining the strengths of contractual governance with the benefits of relational governance.