Compliance Monitor
Big Brother in the boardroom
The FSA is now a presence on the boards of systemically important authorised firms. But, Tom Custance and Deepak Arora ask, is this helpful hands-on supervision or regulatory over-intrusion?
Tom Custance (tcustance@foxwilliams.com) is a partner and Deepak Arora (darora@foxwilliams.com) an associate within the financial services sector group at law firm Fox Williams.
In adopting a more active and intrusive form of supervision, and in pursuit of its mandate of protecting and enhancing financial
stability, the FSA has started to attend board meetings of those firms that it considers pose a potential risk to the UK’s
financial stability. It has taken this step in direct response to the criticisms it faced during the aftermath of the financial
crisis, that it had a ‘hands off’ and ‘tick box’ approach to financial regulation. Is this development a welcome change, or
will it prove to be a case of ‘too many cooks spoil the broth’?