2 - The Governance of the Bank for International Settlements, 1973–2020

Summary

This chapter discusses the transformation of the Bank for International Settlements from a predominantly European organisation into a truly global one. This transformation coincided with, and was the result of, the rapid rise in prominence of the emerging-market economies, particularly from the 1990s. Until the mid-1990s the BIS, although serving the global central banking community, was in terms of governance and organisation strongly dominated by the Group of Ten advanced industrial countries. Because of history and statutory constraints – but also because the G10 very much valued their close cooperation – this changed only gradually. The chapter outlines in detail how and why the BIS first expanded its shareholding membership and only then its internal governance structure to become truly representative of the global economy. The great financial crisis of 2007–8 further accelerated this process, which was basically concluded by the end of the 2010s, with all major central banks being represented on the BIS Board of Directors.