The Regulatory Aftermath of the Global Financial Crisis
The Harvard Law School Forum on Corporate Governance and Financial Regulation 2013-04-30
Some 5 ½ years out from the Autumn 2008 Lehman Brothers collapse, the massive effort by the world’s leading economies to reset the regulation of the financial system is now entering its final stages. The momentum for reform remains strong, particularly with respect to shadow banking. But the main elements of the 2008-2009 G20 regulatory agenda are now in place. In the EU, for example, recent weeks have seen agreement on the Capital Requirements Directive IV, which implements the Basel III agreement and is one of the final elements of the EU’s crisis-era reform programme. Internationally, the regulatory perimeter has extended significantly, new regulatory tools and styles have been developed, and institutional structures have been reformed and replaced. The critical implementation phase is now well underway; the new EU regime has rapidly been intensified by a host of implementing rules; the behemoth US Dodd Frank Act is being subject to similar intensification. The review process is already gathering stream; the EU’s crisis-era short selling regime and its new institutional structure for financial system supervision are both to be reviewed over 2013. It is time to take stock.
In our new book, The Regulatory Aftermath of the Global Financial Crisis we (Eilís Ferran, Niamh Moloney, Jennifer Hill, and John C. Coffee Jr.) examine the forces which have shaped the international regulatory reform process and consider the likely legacy effects of the crisis-era. The book adopts a comparative approach. It examines in detail how the EU and the US - two major world economies heavily affected by the financial crisis - responded to the crisis. But it also considers the Australian experience and probes why the Australian regulatory system and economy proved resilient over the financial crisis and the reforms which it has, nonetheless, experienced. Comparison of these three major economies and how they performed over a period of extreme stress tells us much about the complex regulatory, political and economic ecosystems of which financial markets are a part.