With the findings due any day now by the U.K. financial watchdog into the Libor rate-setting manipulation scandal, market participants are hoping that investor confidence will return if more transparency is introduced.

Libor, or the London interbank lending rate, is used as a benchmark interest rate for around $800 trillion of derivative and debt contracts around the world but its integrity was brought into question in June when Barclays was hit with a record fine of $451 million from regulators in the U.K. and U.S after Britain’s second biggest bank admitted to manipulating Libor from 2005-2009 to the benefit of its derivative positions as well as by a desire to make the bank look stronger during the financial crisis. Other banks are likely to be implicated in the scandal.

Libor is a notional rate set by a 16-bank panel based in London. Members of the panel of international banks are all asked how much it would cost to borrow from one and other and the rate is then calculated and published daily by market data vendor Thomson Reuters on behalf of the British Bankers’ Association, a trade association, covering a variety of currencies and time durations.

Since the scandal broke in late June, calls have grown for changes to the rate-setting system. In late July, the U.K. government set up a review that is being conducted by Martin Wheatley, a top official at the Financial Services Authority (FSA), which is looking into how Libor is calculated and regulated. An initial discussion paper has said that a dramatic overhaul of the key benchmark borrowing rate is needed.

“Because Libor underpins the pricing of such a vast array of financial instruments and products, any weaknesses in its calculation and oversight jeopardize the integrity of the financial system,” said Rhodri Preece, director of capital markets policy for the CFA Institute, the global association for investment practitioners and academics.

“Reforming Libor is therefore a crucial step to restoring investor and public trust from its current fragile state. Investment professionals have made it clear that the process can be improved by using actual transaction rates and better oversight. Allied to a strong commitment to ethical behavior among individuals and firms, these steps can help rebuild confidence.”

Meanwhile, a recent survey by consultant Lepus has found that over 60% of banking industry professionals polled believed that regulators turned a blind eye to inter-bank interest rate fiddling to preserve market confidence and that regulators tolerated the manipulation of Libor for this end. Lepus received responses from 103 respondents from 44 banks across the globe for its survey.

Confidence in Libor has plummeted in recent months and the revelations have renewed calls for tougher oversights of the financial system. The European Securities and Markets Authority, the pan-European regulator, is looking to impose strict new market abuse rules with big fines and a damaged reputation on the cards for any firm who falls foul of the new financial benchmark regulations.

While Iosco, or the International Organization of Securities Commissions Organization, the international securities regulators’ body, has set up a task force to identify relevant benchmark-related policy issues and develop global policy guidance and principles for benchmark-related activities of particular relevance to market regulators, with a view of producing a report later this year on the matter.

“Given the global nature and extensive use of benchmarks in a wide range of financial markets and products, it is important to develop internationally consistent principles that ensure their credibility and integrity,” said Wheatley at the FSA, who is also a member of the Iosco board.

Masamichi Kono, chairman of the Iosco board, added: “Iosco, as the international organization of financial market regulators, is firmly committed to restoring confidence in benchmarking activities globally, and will carry forward the needed work expeditiously through this task force.”