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Part I General, 1 Governing Financial Institutions: Law and Regulation, Conduct and Culture

Danny Busch, Guido Ferrarini, Gerard van Solinge

From: Governance of Financial Institutions

Edited By: Danny Busch, Guido Ferrarini, Gerard van Solinge

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2023. All Rights Reserved.date: 26 September 2023

Bank supervision — Investment business

This introductory chapter provides an overview of the governance of financial institutions. After the numerous bank failures resulting from the 2008 financial crisis, regulation and supervision have been enhanced both as a complement to the governance of financial institutions and as a substitute for the same in areas where governance failures appear more evident. Indeed, the financial crisis has led to a restatement of the global principles concerning the corporate governance of financial institutions in the belief that governance failures contributed to these institutions' failures in the crisis. Given that corporate governance is a complement to regulation in assuring the stability of financial institutions, an important question for policy research is to what extent and under what conditions regulation should work either as a complement or a substitute for corporate governance.

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