Monetary policy and banking supervision: coordination instead of separation. CEPS Policy Brief No. 286, 12 December 2012

Introduction. Following the June 2012 European Council decision to place the ‘Single Supervisory Mechanism’ (SSM) within the European Central Bank, the general presumption in the policy discussions has been that there should be ‘Chinese walls’ between the supervisory and monetary policy arms of the ECB. The current legislative proposal, in fact, is explicit on this account. On the contrary, however, this paper finds that there is no need to impose a strict separation between these two functions. The authors argue, in fact, that a strict separation of supervision and monetary policy is not even desirable during a financial crisis when the systemic stability of the financial system represents the biggest threat to a monetary policy that aims at price stability. In their view, the key problem hampering the ECB today is that it lacks detailed information on the state of health of the banking system, which is often highly confidential. Chinese walls would not solve this problem. Moreover, in light of the fact that the new, proposed Supervisory Board will be composed to a large extent of representatives of the same institutions that also dominate the Governing Council, the paper finds that it does not make sense to have Chinese walls between two boards with largely overlapping memberships. In addition, it recommends that some members of the Supervisory Boards should be “independents” in order to reduce the tendency of supervisors to unduly delay the recognition of losses.

Doctoral supervision of colleagues: peeling off the veneer of satisfaction and competence

The nexus of teaching, administration and research activities engaged in by academic staff in higher education means that each individual plays a multitude of roles in relation to colleagues, producing inevitable tensions. One role relationship that epitomizes this extraordinary juggling task is that of doctoral supervisor/supervisee, when both are academic staff in the same institution. The last 10 years has seen an upsurge of research interest in doctoral research students, and government and funding bodies have imposed ever more stringent requirements on supervisors. However, staff pairings have been ignored in this literature and research. This article reports on an exploration that seeks to redress this omission by giving voice to the participants (colleague supervisor or research student), allowing them to articulate constructs about what may be unique in the interaction, thus highlighting factors that support or impede success in the enterprise.