Financial Stability Board Charter Defines Global Oversight Role

The Financial Stability Board (FSB) coordinates financial authorities and standard setters across countries to address risks to the global financial system and support planning for crises that cross borders.

Its mandate includes assessing vulnerabilities, identifying possible regulatory responses and reviewing the results of those responses. The board also promotes information sharing among authorities responsible for financial stability and monitors market developments for their policy implications.

The FSB reviews the policy work of international standard setters and supports groups of supervisors overseeing firms across borders. It helps authorities prepare for international financial crises and works with the International Monetary Fund on early warning exercises.

The charter directs the FSB to coordinate standard setters when their work overlaps or leaves gaps. That role covers systemic risk, market integrity, investor and consumer protection, financial infrastructure, accounting and auditing.

The board consults members and other stakeholders when developing plans, principles, standards and guidance. Its consultation process includes regional outreach intended to involve authorities from countries outside its membership in discussions about financial stability.

Membership is open to national and regional financial authorities, international financial institutions, and regulatory and supervisory bodies. Member jurisdictions commit to financial stability, an open and transparent financial sector, international standards and periodic peer reviews.

The plenary is the FSB's decision-making body and acts by consensus. It approves the work program, adopts policy documents, decides membership, appoints the chair and can amend the charter. The chair serves a three-year term that may be renewed once.

A steering committee guides operations between plenary meetings. It monitors the board's work, coordinates committees and working groups, and keeps members informed. The committee may also establish working groups that include representatives from outside the FSB.

The chair convenes the plenary at least twice a year, normally in March and September. The steering committee meets at least four times a year, and the FSB may hold additional plenary meetings when circumstances require them.