{"id":1782,"date":"2008-06-01T09:02:15","date_gmt":"2008-06-01T13:02:15","guid":{"rendered":"http:\/\/www.journals.law.harvard.edu\/ilj\/site\/?p=1782"},"modified":"2010-09-25T19:57:17","modified_gmt":"2010-09-25T23:57:17","slug":"issue_49-2_walsh","status":"publish","type":"post","link":"https:\/\/journals.law.harvard.edu\/ilj\/2008\/06\/issue_49-2_walsh\/","title":{"rendered":"Institution-Based Financial Regulation"},"content":{"rendered":"<p><span style=\"text-decoration: underline;\">Abstract<\/span><\/p>\n<p><em>This  Article argues that in the ongoing trans-Atlantic discussion about  principles-based and rules-based financial regulation, a new development  has been largely overlooked. This is the rise, in the United States, of  a new approach to financial regulation. The author names this new  strategy &#8220;institution-based&#8221; financial regulation. In this strategy the  regulators, to date the Securities and Exchange Commission and the  Financial Industry Regulatory Authority, require firms to establish  certain institutions. In the U.S. regulatory context these typically  include: a Chief Compliance Officer, compliance policies and procedures,  an annual self-assessment, access for the Chief Compliance Officer to  the firm\u2019s senior-level executives, and internal codes of ethics. The  establishment of these institutions is required by rule, but the  functioning of these institutions within each firm is generally left to  the firms themselves, with the regulators providing interpretations,  guidance, and personal statements. The author argues that  institution-based regulation combines a mandatory institutional  architecture with a customizable firm-specific functionality. This  strategy provides regulatory solutions to a number of global issues,  including: addressing firms\u2019 competitive worries about rivals\u2019  compliance free-riding, recognizing local regulatory choices, providing a  model that is scalable to the size and resources of any firm or market,  building continuous improvement into the regulatory model, and helping  firms in newly emerging markets establish themselves in the  international marketplace. The author concludes that the development of a  global community of compliance institutions staffed by highly skilled  compliance professionals holds great promise for the future, because it  could enhance the mutual trust and confidence needed to forge a truly  global marketplace out of the world\u2019s current medley of regulatory  regimes, while preserving local regulatory choices.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>This Article argues that in the ongoing trans-Atlantic discussion about principles-based and rules-based financial regulation, a new development has been largely overlooked. This is the rise, in the United States, of a new approach to financial regulation. The author names this new strategy &#8220;institution-based&#8221; financial regulation. <\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"jetpack_post_was_ever_published":false,"_FSMCFIC_featured_image_caption":"","_FSMCFIC_featured_image_nocaption":"","_FSMCFIC_featured_image_hide":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[123],"tags":[],"class_list":["post-1782","post","type-post","status-publish","format-standard","hentry","category-print-archives"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/peZu3S-sK","jetpack_likes_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/posts\/1782","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/comments?post=1782"}],"version-history":[{"count":0,"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/posts\/1782\/revisions"}],"wp:attachment":[{"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/media?parent=1782"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/categories?post=1782"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/journals.law.harvard.edu\/ilj\/wp-json\/wp\/v2\/tags?post=1782"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}