Government proposals on financial market reform will be published before the summer, said the financial stability section of yesterday’s budget report.
I hope these take on board the recommendations in a recent paper by David Pitt-Watson and his fellow authors of “The New Capitalists”. “Towards an Accountable Capitalism” has been published in a couple of versions – as a “Private Sector Opinion” by the International Finance Corporation’s Global Corporate Governance Forum and as a paper for IPPR’s Tomorrow’s Capitalism programme.
It highlights that “a successful economy is not just about the tensions between two separate poles: regulation or market. An economy which works effectively is like a political system which works effectively: It has checks and balances, accountabilities and responsibilities, information flows and cultures. Of course regulation is important. But there are five central principles beyond regulation on which a successful financial system depends. These are:
I hope these take on board the recommendations in a recent paper by David Pitt-Watson and his fellow authors of “The New Capitalists”. “Towards an Accountable Capitalism” has been published in a couple of versions – as a “Private Sector Opinion” by the International Finance Corporation’s Global Corporate Governance Forum and as a paper for IPPR’s Tomorrow’s Capitalism programme.
It highlights that “a successful economy is not just about the tensions between two separate poles: regulation or market. An economy which works effectively is like a political system which works effectively: It has checks and balances, accountabilities and responsibilities, information flows and cultures. Of course regulation is important. But there are five central principles beyond regulation on which a successful financial system depends. These are:
- That the entities in it are responsible for their actions.
- They will be responsible if they are accountable.
- Those who call them to account will need relevant information.
- That information must be independently prepared.
- And just as a healthy political system hinges on the scrutiny of vigilant citizens, a successful financial system will need the oversight of vigilant market participants."
Regulation alone will not deliver tomorrow’s sustainable capital markets. “Towards an Accountable Capitalism” offers an important steer on much of what is needed as well.
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