Magazine article Strategic Finance

G30 Report Calls for Financial Reform

Magazine article Strategic Finance

G30 Report Calls for Financial Reform

Article excerpt

In July 2008, the Group of Thirty (G30), a private, non-profit international body of senior financial experts from the public and private sectors and academia, launched a project to examine the global financial crisis and make any recommendations for change. The project was spear-headed by a steering committee led by Paul Volker, chairman of the trustees of the G30 and former head of the Federal Reserve.

The Group released its findings last month. Titled Financial Reform: A Framework for Financial Stability, the report addresses flaws in the global financial system and offers 18 specific recommendations to "improve supervisory systems by redefining the scope, boundaries, and structure of prudential regulation; enhance the role of the central banks; improve governance practices and risk management; address procyclicality via capital and liquidity standards; enhance accounting practices; strengthen the financial infrastructure; and increase coordination internationally."

According to Volker and G30 Chairman Jacob Frenkel, "While the analysis and recommendations deal in some instances with the need for legislation, regulation, and supervision, the Report is not directed toward questions about the appropriate focus and nature of national administrative arrangements. ... The Report, rather, focuses on how the financial system might reasonably be organized once the present crisis has passed, to better assure a reasonable degree of stability." Many people have suggested that this points to a major overhaul of banking regulations and a tightening of oversight.

There are four core recommendations in the report:

* "Gaps and weaknesses in the coverage of prudential regulation and supervision must be eliminated." The report notes that all systemically significant financial institutions, regardless of type, must be subject to an appropriate degree of oversight. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.