The Financial Stability Board: Unlocking the Black Box – New Rules for Global Finance Coalition


What We DoThe Financial Stability Board: Unlocking the Black Box

The Financial Stability Board: Unlocking the Black Box

This is a joint project of the African Economic Research Consortium (AERC), The Brookings Institution, Development Finance International, and New Rules for Global Finance.

The­ rationale of this project is that the Financial Crisis impacted low income countries (LICs), especially those in Africa and that future crises will also impact LICS, but global responses to the financial crisis exclude LICs, even though LICs will be expected to follow new rules. The two leading global financial rule-makers are the International Monetary Fund (IMF) and the Financial Stability Board (FSB). Civil Society has done considerable work to track the actions and governance of the IMF. As the newer, and potentially more powerful rule-maker, little is known about the FSB, its members and its committees and working groups. Therefore, this project brings together the African Economic Research Consortium (AERC), The Brookings Institution, the University of Missouri/Kansas City, and New Rules for Global Finance, to focus on the G20 and the Financial Stability Board (FSB) where G20 regulators meet far from the prying eyes of the public to design and approve new global financial regulations.

The project team solicits the help of Civil Society Organizations especially in G20 and low income countries.

  1. To identify, and arrange meetings with, G20 participants in the plenary meetings of the FSB and in its various committees and working groups.   The purposes include: to expand the membership of the FSB, especially of committees and working groups designing rules relevant to LICs.
  2. The speculation in commodities, especially food-related commodities, can drive up prices for food-importing LICs, resulting in malnutrition and starvation. This is an area where the G20 and FSB should be issuing regulations, with the input of experts from LICs.
  3. We hope to include the recommendations of LIC-based Civil Society Organizations to incorporate into the research papers.
  4. We will definitely share all research projects with all Civil Society Organizations, and will rely on collegial advocacy to promote the recommendations that grow out of this process.

The Project’s Main Tasks, as currently planned:

  1. Research on the structure and dynamics of the FSB:       currently highly informal, with limited staff, and an independent Chair, Mario Draghi of Italy, who is free to set up committees at will.       This paper will include interviews with participants in the FSB plenary and working groups, the better to address the governance issues and to interject LIC experts into the processes. It will be disseminated widely. (Lead: Dr. Matthew Martin, Executive Director of Development Finance International, London)
  2. A high-level panel to recommend reforms for the governance of the Financial Stability Board (Lead: Dr. Domenico Lombardi, Oxford University and the Brookings Institution)
  3. Additional research into specific issues identified by the Committee of 10 (C-10) Finance Ministers of Africa, through the AERC, where they would like additional technical help. These papers will focus on Basle Agreements that set banking standards and how those standards affect banking in Africa. (Lead: Dr. Victor Murinde, AERC and Birmingham University, UK.
  4. Ensure that recommendations and research emanating from this project are shared with US policy makers, other G20 members, and the wider public, especially African countries and publics and other LICs. (Dr. Jo Marie Griesgraber: Executive Director, New Rules for Global Finance)

Publications