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The G20’s roadmap to macro prudential oversight

In May 2009 we set out to understand how the systemic risk component of the G20 action plan would be realised.  The purpose of the research was to analyse the different regulatory initiatives that followed, their implications and how they could be implemented.

We have digested thousands of pages of regulatory consultation and guidance, interviewed scores of industry professionals, formulated the ‘hard questions’ and sought the answers.  We have analysed the results with a view to understanding what capabilities the entire industry needs to ‘do risk right.’

In the course of compiling our findings, it became clear that, while the political will to control the markets is strong, the understanding of how to do this is weak.  During the course of our analysis, we have been surprised by how quickly the G20 has moved to set hard deadlines for solutions to these problems that are not yet well understood.

This paper lays out an independent perspective on what new fire prevention policies the G20 is prescribing and discusses the effectiveness of the current initiatives.  We would like to thank everyone involved in this discussion thus far for their time and open feedback on these issues.