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Central Bank Governance and the Role of Nonfinancial Risk Management

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  • Mr. Ashraf Khan

Abstract

This paper argues that nonfinancial risk management is an essential element of good governance of central banks. It provides a funnelled analysis, on the basis of selected literature, by (i) presenting an outline of central bank governance in general; (ii) zooming in on internal governance and organization issues of central banks; (iii) highlighting the main issues with nonfinancial risk management; and (iv) ending with recommendations for future work. It shows how attention for nonfinancial risk management has been growing, and how this has amplified the call for better governance of central banks. It stresses that in the area of nonfinancial risk management there are no crucial differences between commercial and central banks: both have people, processes, procedures, and structures. It highlights policy areas to be explored.

Suggested Citation

  • Mr. Ashraf Khan, 2016. "Central Bank Governance and the Role of Nonfinancial Risk Management," IMF Working Papers 2016/034, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2016/034
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    References listed on IDEAS

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    1. de Haan, Jakob & Eijffinger, Sylvester C.W. & Rybinski, Krzysztof, 2007. "Central bank transparency and central bank communication: Editorial introduction," European Journal of Political Economy, Elsevier, vol. 23(1), pages 1-8, March.
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    4. Schwarz Claudia & Karakitsos Polychronis & Merriman Niall & Studener Werner, 2015. "Why Accounting Matters: A Central Bank Perspective," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 5(1), pages 1-42, March.
    5. Sylvester Eijffinger & Donato Masciandaro (ed.), 2014. "Modern Monetary Policy and Central Bank Governance," Books, Edward Elgar Publishing, number 15692.
    6. Cukierman, Alex & Webb, Steven B & Neyapti, Bilin, 1992. "Measuring the Independence of Central Banks and Its Effect on Policy Outcomes," The World Bank Economic Review, World Bank, vol. 6(3), pages 353-398, September.
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    Cited by:

    1. Valery Goreglyad, 2019. "Systematic Approach to Operational Risk Management in Central Banks (Regulators): Prerequisites, Current Issues, and Development Prospects," Russian Journal of Money and Finance, Bank of Russia, vol. 78(4), pages 99-118, December.
    2. Ferrara, Federico M. & Masciandaro, Donato & Moschella, Manuela & Romelli, Davide, 2022. "Political voice on monetary policy: Evidence from the parliamentary hearings of the European Central Bank," European Journal of Political Economy, Elsevier, vol. 74(C).
    3. Mr. Ashraf Khan, 2018. "Legal Protection: Liability and Immunity Arrangements of Central Banks and Financial Supervisors," IMF Working Papers 2018/176, International Monetary Fund.
    4. Donato Masciandaro & Davide Romelli, 2018. "To Be or not to Be a Euro Country? The Behavioural Political Economics of Currency Unions," BAFFI CAREFIN Working Papers 1883, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.

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