Here’s an ‘officious’ list of 10 principles for regulators
The idea of penning this down came from a re-reading of Machiavelli’s Prince. This book laid down principles of statecraft back in 1513, but remains valid today. In the same spirit, this is an ‘officious’ list, entirely unsolicited, of principles for regulators of all kind.
Readers, please do pay heed to caveat emptor. Know your principal constituency well: A regulator must ab initio know whose interests it must primarily protect. This ought to be written into the Act of law that establishes and governs the regulator.
But doing this is one thing and it getting encoded in the regulator’s internal belief system is another. The regulator must be aware of the needs, difficulties and expectations of the constituency it serves, and it must play a developmental role. It’s like the ‘Principality’ that Machiavelli talks about; when it flourishes, the country prospers.
Hear, listen and build listening posts: The regulator should be aware of perceptions of it held by its principal constituency and other people connected with it. For this, the regulator should set up appropriate high-fidelity listening posts to relay feedback and provide early warning signals. The regulator must develop transparent mechanisms to gather the opinions of its constituency and other relevant players, especially about their concerns over its policies and impending changes.
If policy shifts are well informed and implemented through open consultations, they will be accepted more easily. Use advisors but choose them carefully: It is not possible for a regulator to know everything in its field of oversight. It must select advisors from among representatives of its primary constituency, intermediaries who are linked to the business under regulation, critics of
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