Corporate Governance of Banking Organizations in the United States and in Japan
Bank regulators have been aware of the importance of sound corporate governance practices of banking organizations, and have recognized themselves as stakeholders. The Basel Committee on Banking Supervision, whose membership includes Japanese and American bank regulators, issued “Enhancing Corporate Governance for Banking Organisations” in 1999. Both Japan and the United States, however, have been slow in making legislation, regulations or guidelines for banking organizations based on “Enhancing Corporate Governance for Banking Organisations.” In 2002, both countries enacted new corporate governance laws. Although these laws are applicable to all businesses, they can be helpful to bank regulators by urging banking organizations to promote sound corporate governance and improve their bank supervision function. When bank regulators make new regulations and guidelines regarding banking organizations’ corporate governance, they should make sure that “Enhancing Corporate Governance for Banking Organisations” is reflected in them.