This paper canvases the role of the G20 in strengthening financial regulation.

Key findings:

  • Financial regulation has been central to the G20 since the first leaders’ summit in 2008. Leaders wanted to ensure that another devastating financial crisis would not happen again.
  • The financial reform agenda has grown substantially in complexity, particularly in terms of institutions covered, instruments subject to regulation, the detail involved and cross border implications.
  • However concerns are being raised, including inconsistency in the domestic implementation of the new regulatory standards and their applicability to all countries.
  • Finance is a complex industry, many reforms are being advanced at the same time, and questions are being asked as to whether the approach to regulation is too complex and there are to many ‘unintended consequences.'
  • The G20 should not simply be a rubber stamp for the Financial Stability Board. The G20 should be ensuring that the cumulative impact of the regulatory reforms are assessed, particularly in terms of balancing the quest for stability with the economic impact of the reforms. The G20 should also focus on the consistent application of the reforms.
  • A theme the G20 could pursue in 2014 is how the institution could play a stronger role in overseeing financial regulation.

Authored by Mike Callaghan AM, Hugh Jorgensen, Stephen Pickford, Richard Gray, Steven Bardy, Graham Hodges and Ross Buckley.

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