## ppea2019011

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### Executive summary — background and mandate
- The Executive Board requested a revision and update of the 1999 Monetary and Financial Policies Transparency Code (MFPT) at the time of the 2017 Review of the Standards and Codes Initiative (RSCI).
- Directors asked the new code to:
  - remove overlap on financial policies covered by other standards;
  - expand transparency standards to a broader set of activities undertaken by many central banks since the Global Financial Crisis (GFC);
  - reorient transparency standards to facilitate risk-based assessments to support policy effectiveness and address macroeconomic risks.
- The 1999 MFPT identified desirable transparency practices for central banks in monetary policy and for central banks and other financial agencies in financial policies.

### Staff proposal: Central Bank Transparency (CBT) code
- Core proposal:
  - Replace the MFPT with a Central Bank Transparency (CBT) code that narrows the perimeter to central banks only (an institutional or “entity-based” approach) and broadens assessed areas to reflect post‑GFC practices and mandates.
- Key features:
  - Comprises five “Transparency Pillars” covering governance, policies, operations, outcomes, and official relations.
  - Modular approach facilitating risk-based and proportional application taking into account country-specific circumstances.
  - The CBT evaluates the degree of transparency underpinning country-specific mandates, policies, governance and operations; it would not assess adequacy of mandates, autonomy, governance, policies, or operations or pass judgment on institutional choices.

### Rationale and key considerations for the update
- The MFPT has fallen into disuse with very few assessments over the past 10 years.
- Factors motivating the overhaul:
  - Need to maintain quality and increase relevance, including for low-income countries (LICs).
  - Advances in international standards for financial policies since 1999 make separate transparency principles for financial policies redundant.
  - Monetary policy practices since the GFC (including Unconventional Monetary Policies (UMP) and expanded balance sheets) altered norms underpinning MFPT monetary policy transparency principles.
  - Broadening of central bank mandates, functions, and powers (e.g., macroprudential oversight, crisis management, resolution, non-traditional objectives such as financial integrity and consumer protection).
  - The 2017 RSCI recommendation to gear transparency S&C to facilitate policy objectives, support policy effectiveness, and address macroeconomic risks rather than focus mainly on disclosure of operational processes.
  - The Fund’s April 2018 framework for enhanced engagement on governance and corruption includes a central bank component examining governance issues, notably transparency and accountability arrangements.

### Uses and benefits of the CBT
- The CBT could be integrated into:
  - Fund capacity building activities (technical assistance and Financial Sector Stability Reviews),
  - Surveillance (Article IV consultations and FSAPs),
  - Use of Fund Resources (UFR),
  - the Fund’s Good Governance framework.
- The CBT could be used by central banks to map transparency frameworks and make informed choices on disclosure.
- The CBT would help central banks explain legitimate limitations to disclosure (for example, specific microprudential cases) and clarify that absence of specific information does not necessarily imply lack of transparency.

### Transparency, accountability, and central bank mandates
- Transparency is integral to accountability and linked to autonomy:
  - Autonomy enables central banks to formulate and implement policies under their mandates without undue influence.
  - Transparency helps central banks explain and justify actions and account for use of entrusted resources.
- External accountability arrangements: reporting, explanation and justification of decisions and actions, identification of reporting lines, timely access to information (including financial statements).
- Internal accountability arrangements: internal and external audit procedures and ethical and anti‑corruption frameworks for staff and boards.

### Operational approach and next steps
- The modular CBT will facilitate risk-based and proportional application across varied country circumstances, including LICs and emerging markets (EMs).
- Staff is seeking Board endorsement to prepare the CBT in FY2020 and to consult with an external advisory group prior to further Board discussion.
- Staff prepared the proposal drawing on extensive case studies of central bank transparency practices to refine the framework.

### CBT structure: the five “Transparency Pillars”
- Pillar I. Transparency in governance — covering institutional issues.
- Pillar II. Transparency in policies — focusing on the economics of central bank decisions.
- Pillar III. Transparency in operations — highlighting how policy decisions are implemented (instruments, coverage, access).
- Pillar IV. Transparency in outcome — focusing on how outcomes of central bank policies and other actions are reported to stakeholders.
- Pillar V. Transparency in official relations — covering central bank interactions with government, other domestic agencies, and international relations and commitments.

### Case studies and validation of the framework
- The framework was refined through analysis of central bank transparency practices in a sample of central banks from 24‑member countries and the European Central Bank (ECB).
- Sample included Fund members from different regions, income levels, and diverse mandates.
- Information sources reviewed included: legal documents; central bank publications and websites; MFPT assessments; Fund technical assistance reports; IMF Central Bank Legislation Database (CBLD); selected academic research.
- Aggregated findings from the sample:
  - Central banks in the sample appear fairly transparent on governance (Pillar I), policies (Pillar II), and official relations (Pillar V).
  - Less transparency was observed on operations (Pillar III) and especially on outcomes (Pillar IV).
  - Gaps are evident in modalities used to explain monetary policy operations and activities such as payments systems.
  - Transparency related to non‑traditional objectives (e.g., ELA, resolution, financial integrity, consumer protection) is even less common, including where mandates exist.
  - Transparency gaps are more prevalent in newer central bank mandates; contrast between relatively high transparency in traditional micro‑ and macro‑prudential areas and lower transparency in less traditional mandates.
  - Large variance exists in transparency practices related to ELA operations.
- Methodology note:
  - Overall transparency for the aggregation was calculated as the simple average of binary scores (transparent: “yes,” not transparent: “no”) given to every module without assigned weights; staff note this gives a broadly clear picture for Pillars II to V but Pillar I requires more granular examination.

### Aggregated case‑study results — pillar highlights and exact findings
- Pillar I. Governance — high‑level findings:
  - Broad transparency of legal status but much less regarding staff immunities and gaps in transparency in legal framework.
  - Transparency of price stability and payment systems; high transparency of micro‑ and macro‑prudential respectively; less for ELA, financial integrity and consumer protection.
  - High transparency of functional and financial autonomy; less of institutional and personal autonomy.
  - Broad transparency of decision‑making structures for price stability and micro‑/macro‑prudential; less for financial integrity and consumer protection.
  - Broad transparency of internal risk management policies but some gaps regarding risk decision‑making structures.
  - Broad transparency of financial statements and reporting to government; generally no publication of the audit report.
  - Broad transparency of lack of ethics/Code of Conduct requirements.
  - Broad transparency of communication strategy and policy, and confidentiality rules.

- Pillar II. Policies — high‑level findings:
  - Broad transparency of monetary, macro and micro‑prudential and payment systems policies.
  - Some gaps with respect to ELA, resolution, financial integrity and consumer protection (where applicable).

- Pillar III. Operations — high‑level findings:
  - Broad transparency of monetary and payment systems operations, and, to a lesser extent, micro‑ and macro‑prudential operations and resolution.
  - Important gaps exist with respect to ELA, financial integrity and consumer protection (where applicable).

- Pillar IV. Outcome — high‑level findings:
  - Broad transparency of the outcomes of monetary policy and, to a lesser extent, financial policies.
  - Much less transparency with respect to ELA, resolution, financial integrity and consumer protection (where applicable).

- Pillar V. Official Relations — high‑level findings:
  - Broad transparency of relationships with government, with the notable exception of transparency about credit to government.

### Detailed aggregated findings and sample statistics
- Legal status and immunities:
  - Out of 143 countries and monetary unions of which the central banks laws are listed in the IMF’s CBLD, only 53 percent contains at least one explicit reference to liability arrangements.
  - Central banks are generally not transparent about legal immunities on their own websites; some immunities may be provided by other domestic laws.
- Mandates and objectives:
  - All central banks in the sample are transparent regarding their price stability and payment systems objectives; these are embedded in central bank law.
  - Not all central banks offer full transparency for ELA as a financial stability function; arrangements for ELA are highlighted by most central banks in central bank laws but can be unclear in some cases, with some ad hoc arrangements.
- Autonomy:
  - Transparency on functional and financial autonomy is well‑established; less so on institutional/operational autonomy.
  - Near to all central banks are transparent about their functional and financial autonomy.
  - Little more than half of central banks are transparent regarding personal autonomy.
  - Less than half are transparent regarding institutional/operational autonomy.
- Decision‑making structures:
  - Next to all central banks are transparent about their decision‑making structures.
- Reporting and auditing:
  - Most central banks are transparent about their financial statements and annual reporting to government.
  - All central banks are transparent about whether they publish an annual report and report financial statements to government. In only two cases the central bank is not transparent about whether it publishes some/a summary of its audit report findings.
- Ethics and codes of conduct:
  - Central banks are not very transparent about ethics or codes of conduct requirements; most are not transparent about existence of an ethics committee or a code of conduct for Board members and/or staff.
- Risk management:
  - One‑third of central banks is not transparent about their internal risk management.
  - Transparency is divided into: (1) risk appetite, risk policies, and risk framework; and (2) risk management decision‑making structure. In both categories, one‑third of central banks is not transparent about whether these exist. In two cases, central banks indicated neither category is applicable.
- Communication strategy and confidentiality:
  - Almost all central banks are transparent about their institutional communication arrangements; except for two central banks, all have published information on institutional communication arrangements.
  - Most central banks are transparent on existence of policies or legal obligations to inform the public.
  - Less than half of central banks are transparent on whether they have undergone publishing/reporting enhancements.
  - Almost all central banks are transparent about general secrecy and confidentiality rules for central bank staff; with two exceptions, most central banks indicate general secrecy and confidentiality rules are established in central bank law and applicable to staff.
  - About 60 percent are transparent about specific rules for Board members’ secrecy and confidentiality arrangements.
  - Less than half are transparent about specific financial stability‑related secrecy and confidentiality rules in central bank law; in five cases these arrangements are not applicable.

### Findings: Operations, outcomes, and official relations (aggregated)
- Transparency in Operations:
  - All central banks in the sample are transparent about monetary and payment systems operations.
  - Central banks lack transparency in particular on operations relating to ELA, financial integrity, and consumer protection, and to a lesser extent on macroprudential and microprudential, as well as resolution.
  - Large number of central banks are not transparent on ELA operations; ambiguity on ELA may be related to efforts to avoid moral hazard.
- Transparency in Outcome:
  - Central banks are mostly transparent about outcomes of their policies and operations for price stability.
  - For price stability outcomes, transparency holds for reporting to parliament and to the minister.
  - However, regarding target, operations, and activities relating to price stability, half of all central banks are not transparent.
  - Similar large transparency gaps occur in reporting to parliament on outcomes of consumer protection and financial integrity for almost all central banks that have these objectives.
  - More than half of the central banks do not report to parliament on outcomes of their payments system objective.
- Transparency in Official Relations:
  - Central banks are mostly transparent about relationships with the government, with the notable exception of the credit function.
  - Transparency on the credit function of the central bank to government is lacking in more than half of the country cases.
  - In several cases, the central bank is also not transparent about its consultation with government.

### Annex III — alignment with other standards (CBT linkages)
- The CBT will rely on other international standards or principles with transparency requirements where applicable (banking, insurance, securities, FMIs).
- Examples of parallels and CBT equivalents:
  - BCBS Core Principles for Effective Banking Supervision → CBT Pillar I and Pillar IV.
  - IAIS Insurance Core Principles → CBT Pillar I, Pillar IV, Pillar V.
  - IOSCO Objectives and Principles of Securities Regulation → CBT Pillar I.
  - CPMI‑IOSCO Principles for Financial Market Infrastructures → CBT Pillar I.

### Summary and next steps (development roadmap)
- Staff proposes to replace the 1999 MFPT with the CBT to:
  - eliminate overlap with FSB standards approved since the MFPT was created;
  - expand transparency criteria to the broader set of activities undertaken since the GFC;
  - facilitate risk‑based assessments to support policy effectiveness and address macroeconomic risks.
- Development steps:
  1. Prepare a draft code and an assessment methodology building on the framework presented (MCM in collaboration with FIN, LEG, SPR, and STA).
  2. Convene an international advisory group of former central bank governors and international experts (including, as needed, from relevant other international institutions).
  3. Extensive consultation with Executive Directors.
  4. Develop a clear timetable for Board discussions of the new code.
  5. Carry out pilot assessments.

### Issues for discussion (as presented)
- Do Directors agree with staff’s proposal to replace the MFPT with the CBT based on the framework advanced in this paper?
- Do Directors agree with the five‑pillar framework proposed to assess the transparency of central banks?
- Do Directors support that staff convenes an international advisory group to provide guidance to staff in the elaboration of the new code?

*Source: IMF Staff.*

### EXECUTIVE SUMMARY

### EXECUTIVE SUMMARY

### Background and mandate
- The Executive Board requested a revision and update of the 1999 Monetary and Financial Policies Transparency Code (MFPT) at the time of the 2017 Review of the Standards and Codes Initiative (RSCI).
- Directors asked that the new code:
  - remove the overlap on financial policies covered by other standards,
  - expand the transparency standards to a broader set of activities undertaken by many central banks since the Global Financial Crisis (GFC),
  - reorient the transparency standards to facilitate risk-based assessments to support policy effectiveness and address macroeconomic risks.
- The 1999 MFPT identifies desirable transparency practices for central banks in their conduct of monetary policy, and for central banks and other financial agencies in their conduct of financial policies.

### Staff proposal: Central Bank Transparency (CBT) code
- Replace the MFPT with a Central Bank Transparency (CBT) code that:
  - narrows the perimeter of the code to central banks only (an institutional or “entity-based” approach),
  - broadens the areas on which transparency would be assessed to reflect post-GFC central bank practices and mandates.
- Key features of the proposed CBT:
  - Comprises five “Transparency Pillars” covering governance, policies, operations, outcomes, and official relations.
  - A modular approach that facilitates risk-based and proportional application taking into account country-specific circumstances.
  - The CBT would take as given the mandates, policies, and governance arrangements of countries’ central banks and evaluate the degree of transparency underpinning those choices. It would not assess the adequacy of mandates, autonomy, governance, policies, or operations or pass judgment on institutional choices.

### Rationale and key considerations for the update
- The MFPT has fallen into disuse with very few assessments over the past 10 years (Figure 1).
- Factors motivating an overhaul:
  - Need to maintain quality and increase relevance of the MFPT for broad applicability including low-income countries (LICs) and better alignment with surveillance and capacity development.
  - Advances in international standards for financial policies since 1999 make separate transparency principles for financial policies redundant.
  - Monetary policy practices since the GFC (including Unconventional Monetary Policies (UMP) and expanded balance sheets) altered norms underpinning MFPT monetary policy transparency principles.
  - Broadening of central bank mandates, functions, and powers (e.g., macroprudential oversight, crisis management, resolution, and non-traditional objectives such as financial integrity and consumer protection) that were not contemplated by the MFPT.
  - The 2017 RSCI recommendation that transparency S&C be geared to facilitate implementation of policy objectives, support policy effectiveness, and address macroeconomic risks rather than focus mainly on disclosure of operational processes.
  - The Fund’s April 2018 framework for enhanced engagement on governance and corruption includes a central bank component examining governance issues, notably transparency and accountability arrangements.

### Uses and benefits of the CBT
- The CBT could be “plugged” into:
  - Fund capacity building activities (technical assistance and Financial Sector Stability Reviews),
  - Surveillance (Article IV consultations and FSAPs),
  - Use of Fund Resources (UFR),
  - the Fund’s Good Governance framework.
- The CBT could be used by central banks themselves to map their transparency frameworks and make informed choices on their transparency arrangements.
- The CBT would help central banks explain limitations to disclosure (for example, on specific microprudential cases) and that absence of specific information does not necessarily imply lack of transparency.

### Transparency, accountability, and central bank mandates
- Central bank transparency is integral to accountability and linked to autonomy:
  - Autonomy enables central banks to formulate and implement policies under their mandates without undue influence.
  - Transparency helps central banks explain and justify actions and account for use of entrusted resources.
- External accountability arrangements include reporting, explanation and justification of decisions and actions, identification of reporting lines, and timely access to information (including financial statements).
- Internal accountability arrangements include internal and external audit procedures and ethical and anti-corruption frameworks for staff and boards.

### Operational approach and next steps
- The proposed modular CBT will facilitate risk-based and proportional application across varied country circumstances, including LICs and emerging markets (EMs).
- Staff is seeking Board endorsement of the proposed approach to prepare the CBT in FY2020 and to consult with an external advisory group prior to further Board discussion.
- Staff prepared the proposal drawing on extensive case studies of central bank transparency practices to refine the framework.

_ppaea2019011 - EXECUTIVE SUMMARY_

### 14.      Transparency contributes to shape central bank’s accountability. Central bank

### 14.      Transparency contributes to shape central bank’s accountability. Central bank

### Transparency as part of accountability
- Central bank transparency arrangements relate to the flow and accessibility of information from the central bank: the ease with which stakeholders can understand and interpret the central bank’s actions which, in turn, would inform the judgment stakeholders make on the central bank’s performance and broad compliance with its mandate.
- Transparency is a tool within the central bank’s broader governance and accountability framework (other elements not relevant to this work are noted in Box 1).
- The MFPT noted: “Transparency is not an end in itself, nor is transparency a substitute for pursuing sound policies; rather, transparency and sound policies are better seen as complements.”10

### Weighing transparency against confidentiality
- Central bank transparency covers:
  - transparency of the mandate;
  - governance arrangements;
  - degrees of autonomy;
  - policy areas, operations, and outcomes related to central bank decisions; and
  - key external relations.
- Application must not be indiscriminate or excessive because many central bank activities have legitimate confidentiality needs.

### Developments since the GFC (Box 1)
- GFC changes in central bank mandates prompted enhanced accountability discussions, including around:
  - emergency liquidity assistance (ELA) legal basis, tools, and instruments;
  - unconventional monetary policy (UMP) transparency;
  - central bank involvement in climate change and financial sector ethics.
- Increased macroprudential oversight powers led many countries to clarify institutional arrangements and central bank roles; shared responsibilities (e.g., with Ministry of Finance and other regulators) add complexity for transparency.

### The proposed Central Bank Transparency (CBT) framework — overview
- Staff proposes replacing the MFPT with a CBT that:
  - maintains some key principles of the MFPT;
  - adapts coverage to reflect post-GFC activities and practices of central banks;
  - takes into account diverse circumstances and environments of central banks;
  - would allow assessments of transparency11 that are outcome-focused, modular, risk-based, and proportional; and
  - would support policy conduct and communications by the central bank and contribute to enhance central bank accountability.

- Intended uses of assessments under CBT:
  - Highlight strengths and weaknesses of a central bank’s transparency practices and their relative importance.
  - Allow modular assessments to prioritize recommendations through a transparency action plan monitored in the context of Article IV surveillance, Financial Sector Assessment Programs (FSAPs), and UFR—including Safeguards Assessments.

- Role in capacity development:
  - Provide key elements of central bank transparency regardless of institutional frameworks.
  - Enable delineation of benchmarks and graduated assessment of conformity.
  - Assist less-developed countries to plan, implement, and monitor reform efforts and to communicate transparency to stakeholders.

### The five “Transparency Pillars” (CBT structure)
- The proposed CBT framework would comprise five “Transparency Pillars,” each a transparency module:
  - Pillar I. Transparency in governance, covering institutional issues.13
  - Pillar II. Transparency in policies, focusing on the economics of the central bank decisions.
  - Pillar III. Transparency in operations, highlighting how policy decisions are implemented.
  - Pillar IV. Transparency in outcome, focusing on the outcome of central bank policies and other actions are reported to stakeholders.
  - Pillar V. Transparency in official relations, covering the central bank interaction with the government and other domestic agencies, and international relations and commitments.

### Case studies and validation of the framework
- The framework was refined through analysis of central bank transparency practices in a group of central banks from 24-member countries and the European Central Bank (ECB).14
- The sample included Fund members from different regions, income levels, and diverse mandates to detect emerging and best practice and assess framework robustness.
- Information reviewed included:
  - legal documents (constitutions, central bank laws, banking laws, other relevant laws/regulations);
  - central banks’ publications, pronouncements, and other public documents on official websites and other media;
  - MFPT assessments carried out since the GFC by IMF staff or publicly available self-assessments;
  - information from Fund technical assistance reports;
  - IMF’s Central Bank Legislation Database (CBLD); and
  - selected academic research on governance and transparency.

- Findings from the sample aggregation:
  - Central banks in the sample appear fairly transparent on governance (Pillar I), policies (Pillar II), and official relations (Pillar V).
  - Less transparency was observed on operations (Pillar III) and especially on outcomes (Pillar IV).
  - Gaps are especially evident in modalities used to explain monetary policy operations and activities such as payments systems.
  - Transparency related to activities or outcomes of non-traditional objectives (e.g., ELA, resolution, financial integrity, consumer protection) is even less common, including where mandates exist.
  - Transparency gaps are more prevalent in newer central bank mandates; a notable contrast exists between relatively high transparency in traditional micro- and macro-prudential areas and lower transparency in less traditional mandates.
  - Large variance exists in transparency practices related to ELA operations.

- Methodological note:
  - For the aggregation exercise, overall transparency was calculated as the simple average of binary scores (transparent: “yes,” not transparent: “no”) given to every module without assigned weights.15 Staff note this gives a broadly clear picture for Pillars II to V but Pillar I requires more granular examination.

### Summary of aggregated case-study results (high level)
- Pillar I. Governance:
  - Broad transparency of legal status but much less regarding staff immunities and gaps in transparency in legal framework.
  - Transparency of price stability and payment systems; high transparency of micro- and macro-prudential respectively; less for ELA, financial integrity and consumer protection.
  - High transparency of functional and financial autonomy; less of institutional and personal autonomy.
  - Broad transparency of decision-making structures for price stability and micro-/macro-prudential; less for financial integrity and consumer protection.
  - Broad transparency of internal risk management policies but some gaps regarding risk decision-making structures.
  - Broad transparency of financial statements and reporting to government; generally no publication of the audit report.
  - Broad transparency of lack of ethics/Code of Conduct requirements.
  - Broad transparency of communication strategy and policy, and confidentiality rules.

- Pillar II. Policies:
  - Broad transparency of monetary, macro and micro-prudential and payment systems policies.
  - Some gaps with respect to ELA, resolution, financial integrity and consumer protection (where applicable).

- Pillar III. Operations:
  - Broad transparency of monetary and payment systems operations, and, to a lesser extent, micro- and macro-prudential operations and resolution.
  - Important gaps exist with respect to ELA, financial integrity and consumer protection (where applicable).

- Pillar IV. Outcome:
  - Broad transparency of the outcomes of monetary policy and, to a lesser extent, financial policies.
  - Much less transparency with respect to ELA, resolution, financial integrity and consumer protection (where applicable).

- Pillar V. Official Relations:
  - Broad transparency of relationships with government, with the notable exception of transparency about credit to government.

### Summary and next steps
- The paper contains a staff proposal to revise the 1999 MFPT in response to a request made by the Executive Board at the time of the 2017 RSCI.
- Staff proposes to replace the MFPT with the CBT to:
  - eliminate overlap with FSB standards approved since the MFPT was created;
  - expand transparency criteria to the broader set of activities undertaken since the GFC;
  - facilitate risk-based assessments to support policy effectiveness and address macroeconomic risks.

- Developing the CBT will entail several steps:
  (1) preparing a draft code and an assessment methodology building on the framework presented in this note (MCM in collaboration with FIN, LEG, SPR, and STA);
  (2) convening an international advisory group comprised of former central bank governors and international experts (including, as needed, from relevant other international institutions) to provide guidance and feedback to draft code and methodology;
  (3) extensive consultation with Executive Directors;
  (4) developing a clear timetable for Board discussions of the new code; and
  (5) carrying out pilot assessments.

### Issues for discussion (as presented)
- Do Directors agree with staff’s proposal to replace the MFPT with the CBT based on the framework advanced in this paper?
- Do Directors agree with the five-pillar framework proposed to assess the transparency of central banks?
- Do Directors support that staff convenes an international advisory group to provide guidance to staff in the elaboration of the new code?

*Source: IMF Staff.*

### Annex I. Central Bank Transparency Framework

### Annex I. Central Bank Transparency Framework

### Pillar I. Transparency in Governance

- This annex describes the categories and concepts used in each of the five pillars of the proposed CBT framework.

- I.1. Legal Status
  - Information provided to the public regarding:
    - a. the central bank’s legal framework;
    - b. its legal personality; and
    - c. general considerations on central bank immunity/liability, legal protection of central bank decision-makers and staff, with particular reference to whether these individuals may be subject to legal suits/liability for any adverse consequences of decisions made under the course of conducting their official duties.

- I.2. Mandate
  - Relates to three components: (a) objectives, (b) functions (tasks) and (c) instruments (tools), defined in relevant legislation or regulation. This allows central banks to reveal what they are trying to achieve, the fundamental principles governing their actions and any changes in objectives.
  - a. Objectives are the goals that the central bank aimto accomplish. It is well-established practice that central bank laws identify price stability—or a similar concept—as a primary (or one of the main objectives) of the central bank. Many central banks may have other objectives as part of their mandate, including economic (e.g., support the economic policies of the government, full employment, economic growth, financial inclusion, etc.), often subordinated to the price stability objective, and can also have financial stability (micro- and macro-prudential), financial integrity (relating to ensuring compliance with AML/CFT aspects), and consumer protection objectives.
  - b. Functions (tasks) are the activities that the central bank undertakes to achieve these goals. In addition to the traditional function of monetary policy, central bank laws and other relevant laws typically establish core functions which are often related to a specific central bank objective.
  - c. Instruments (tools) are the instruments at the disposal of a central bank to implement its functions. These instruments can be of a private and public law nature:
    - i. Typical private law instruments are the explicit authorization (a) to enter into a wide range of financial contracts, (b) to take deposits of cash and securities, and (c) to take and enforce collateral (sometimes under a special regime).
    - ii. Public law instruments can include the authorization to (a) issue legally-binding regulatory instruments (such as the imposition of ceilings on commercial banks’ lending, minimum reserve requirements, etc.) and (b) the power to impose administrative sanctions in case of breach of normative obligations.

- I.3. Autonomy (Independence)
  - Central bank autonomy or independence (Box 1) relates to four core areas: (a) functional, (b) institutional (operational), (c) personal, and (d) financial.
  - Box 1. Terminology Note: “Autonomy” vs Independence
    - “Independence” is the legal term used in the majority of central bank legal frameworks, but with some variations. The European System of Central Banks Statute uses “independence,” though only as a section title, not in the text that follows it. A number of countries (e.g., Dominican Republic, Iraq, and Slovenia,) use “independence” in their constitution, but “autonomy” in the central bank law (Macedonia has it the other way around). Some countries combine independence and autonomy in the same sentence. For example, in Liberia the central bank law specifies an “independent central bank with autonomous regulatory powers.” Discussions in relevant literature highlight the difficulty of defining independence vs. autonomy (see, for instance, BIS, 2009, Issues in the Governance of Central Banks – A Report from the Central Bank Governance Group (Basel: Bank for International Settlements), and BIS, 2011, Central Bank Governance and Financial Stability. Basel: Bank for International Settlements.
    - Additionally, central bank legislation shows a difference in using adjective and noun forms. When independence and autonomy are used as adjectives, i.e., “independent” and “autonomous”, they would appear to be referring to a narrower context than that of the central bank as a whole. Similarly, some laws refer to the narrower context of “financial autonomy” only.
    - It is also possible that the terms are used interchangeably, used without an intended distinction in meaning, or face translation issues from the original drafting language.
    - For the purposes of this paper, the word “autonomy” will be used throughout, notwithstanding specific legal frameworks and/or discussions.
  - Functional Autonomy
    - Central bank autonomy is not an end in itself but is instrumental in achieving the central bank’s mandate. This could include a prohibition for third parties to approve, suspend, annul, or defer central bank decisions. In addition, it could have separate legal personality and have the necessary private and public law instruments to implement its functions without the government having to approve or adopt specific instruments necessary for the central bank’s functioning. Also, there would ideally be clarity on which other legislation is applicable to the central bank and the latter should be consulted prior to the adoption of any legislation that might affect it.
  - Institutional (operational) Autonomy
    - Focuses on the legal prohibition for a central bank and the members of its decision-making bodies to seek or take instructions from any public or governmental authority and from any other (including commercial) body. It also deals with authorities and bodies being explicitly prohibited from seeking to influence the central bank, and the members of its decision-making bodies whose decisions may affect the fulfillment of the central bank’s mandate. Finally, it relates to the representatives of third parties being excluded from voting when they participate in central banks’ decision-making bodies.
  - Personal Autonomy
    - Relates to adequate safeguards that shield the personal autonomy of key central bank officials from political and private economic interests. These safeguards could include the following considerations:
      - a. The minimum term of office for these central bank decision-making officials being longer than the electoral cycle in the respective country.
      - b. More than one authority being involved in their appointment, respectively dismissal (so-called double veto procedure).
      - c. Robust eligibility criteria and incompatibility requirements being in place to facilitate the appointment of persons of high competencies and integrity to a central bank’s decision-making bodies and prohibit government and political officials from such appointment (at least as full voting members).
      - d. Strong grounds to protect key officials from arbitrary dismissal by a requirement that they can only be relieved from office if they no longer fulfill the conditions required for the performance of their duties, or if they have been found guilty of serious misconduct, whilst having due process, including judicial recourse, in the event of a dismissal.
  - Financial Autonomy
    - A central bank’s autonomy could be jeopardized insofar as it cannot continuously avail itself of sufficient financial resources to fulfill its mandate. Financial autonomy implies that the central bank (as per the central bank law) has sufficient financial resources and is automatically recapitalized in case its capital falls below its authorized capital.
    - The central bank law contains clear rules on the determination of a central bank’s budget and mandate the central bank to establish the adequate level of provisions and reserves (including the possibility of dynamic capital), as well as rules on distribution of dividends to the government.
    - Additionally, financial autonomy also refers to the (full or in part) prohibition of, or clear limitations on, loans to government, other public entities, and other forms of (quasi-) fiscal financing.

- I.4. Decision-Making Structure
  - Relates to the organizational structure or hierarchy of decision-making bodies of the central bank which is responsible for (a) policy making, (b) day-to-day management, and/or (c) internal oversight of the central bank, including board of directors, committees, or any other governing body of the central bank, established by law or regulation.

- I.5. Internal Accountability
  - Deals with the availability of an internal accountability framework, which includes:
    - (a) clearly defined frameworks for internal audit (and internal audit findings), risk management, compliance (including an ethics and/or anticorruption framework for central bank decision-makers and staff), and external audit (including clarity on accounting and reporting standards);
    - (b) the legal requirement to report to the Board (or other decision-making body), and/or its Audit Committee, on matters of internal and external audit, risk management, and compliance; as well as
    - (c) the external publication of (but not limited to) financial statements, annual reports, and standards for the conduct of personal financial affairs.

- I.6. Risk Management Systems
  - Risk management in the broadest sense is defined as “the coordinated activities to direct and control an organization with regard to risks” (ISO 31000 guide 73:2009, Risk Management – Vocabulary).
  - Transparency on risk management relates to the risk appetite and its framework: the overall approach, including statement, policies, processes, controls, and systems through which the risk appetite is established, communicated, and monitored.
  - Risk management covers both financial and nonfinancial risks. A risk appetite statement could be a written, published, and widely-communicated document, referring to the amount and type of risk that a central bank is willing to take to meet their strategic objectives.

- I.7. Communication Strategy and Policy, Public Information Services including Secrecy and Confidentiality Framework
  - The communication strategy covers the means and methods of internal and external communication used by the central bank and the forms of disclosure of information to its stakeholders. Public information services established by the central bank, including a publication program, would be in accordance with relevant legislation. Those services are aimed at the central bank being accessible and effective in reaching stakeholders and supporting central banks functions and objectives. This also includes aims and means of communication by public officials set in law, guidelines, or regulations, as well as published data management systems, general procedures, and rules.
  - Laws and/or regulations would contain the central bank’s policy on confidentiality or secrecy of central bank information, or its non-disclosure policy of its operations in law or regulation. Laws or regulations cover when central bank decision-makers and/or staff are required to keep secrecy and under what conditions confidentially of information is classified as such. This includes prohibitions from disclosing confidential information provided by a third person to the central bank or elaborated on by the central bank itself. It also includes specific disclosure or non-disclosure frameworks or regulations for high ranking central bank officials and/or central bank decision-makers.

### Pillar II. Transparency in Policies

- Pillar II refers, in general, to public availability of information on monetary and financial policies, within the mandate of the central bank, and how these are publicly disclosed or published.

- II.1. Policy Decisions
  - Refers to the policy decisions, whether new actions or changes to standing policies, announced at the time, or soon after they occur, including public statements on the policy objective, rationale, and potential impact.

- II.2. Supporting Analysis
  - Refers to the publication of the in-house analysis underlying the policy decisions to achieve the intended policy objectives.

- II.3. Decision-Making Process
  - Disclosure of procedural actions, which can include the way monetary, foreign exchange and financial policy decisions are taken; deliberations, means, and methods of reaching a decision; and minutes, voting, records of governing bodies, as well as any relevant public consultation process.

- Coverage of Policies
  - The scope of central bank policies is determined by its mandate, de jure and de facto. All central banks have monetary policy as a primary responsibility, but broad variations exist with respect to financial policy responsibilities related to financial stability, integrity and consumer protection. Notwithstanding this diversity, the three elements constituting the transparency in policies pillar: policy decisions, supporting analysis, and decision-making process are relevant and are applied to all policies pursued by central banks.

- Monetary Policy
  - Refers to the central bank’s description of and explanation to the public of the framework, instruments, and methods (data, models, forecasts, and simulations) used to pursue the objectives of monetary policy. This includes announcements regarding changes in monetary policy at the time or soon after they occur and the issuance of public statements on progress made towards achieving the central bank’s monetary policy objectives. Policies include actions on reserve requirements, conditions of lending, as well as credit and interest rate controls.

- Financial Stability
  - Includes general considerations regarding the disclosure of overlapping responsibilities among different institutions and the allocation of responsibilities or cooperation on policy and operations related to the financial stability objective.
  - Macroprudential Framework:
    - Roles and responsibilities that allow the central bank to wholly or jointly with other institution(s) establish the macroprudential policies and tools to mitigate systemic risk in legislation or regulations. This includes central bank policies to monitor financial stability risk in different sectors of the economy; exposures of the banking system to households and to nonfinancial firms, liquidity risks, and foreign exchange mismatches in the banking sector; systemic liquidity risks and fire sale risks in the nonbank financial sectors; and risks from systemically important institutions and interconnectedness within the financial system.
  - Microprudential supervision:
    - The responsibility of the central bank wholly or jointly with other institution(s) on general policies regulating financial institutions, such as licensing and registration, and the institutional arrangements to implement its supervisory power, as disclosed in legislation. This includes methods used to supervise financial institutions; the exchange of information between the central bank and financial institutions; and any sanctions regime to which financial institutions are subject to and is implemented by the central bank.
  - ELA:
    - Emergency Liquidity Assistance framework established or used by the central bank to provide central bank money to solvent financial institutions that are facing temporary liquidity problems, as disclosed in legislation or central bank regulations and disclosed to stakeholders.
  - Resolution:
    - The framework that allows the central bank to deal with failing banks that pose a risk to the financial system and encompasses measures to minimize negative impacts in the financial environment, including preventive measures to avoid failure of a financial institution, and as established in legislation.
  - Payment and Securities Settlement System:
    - The policy and policy formulation by the central bank of its oversight responsibility, and as established by law or resolutions known by its stakeholders.

- A. Financial Integrity
  - Policies and measures taken wholly or jointly with other institution(s) by the central bank to assure transparency and ethical practices on financial transactions, anti-money laundering mandate and functions, anti-terrorism financing functions and practices, anti-corruption mechanisms in financial transactions, and financial inclusion mechanisms that directly promote financial integrity. This could also include the role of a Financial Intelligence Unit (FIU).

- B. Consumer Protection
  - (Section heading present in source; content not included in supplied excerpt.)

*Annex I. Central Bank Transparency Framework (excerpt).*

### 26.      The legal framework, institutional arrangement(s), and mandates for supervisory activities

### 26.      The legal framework, institutional arrangement(s), and mandates for supervisory activities

### Pillar III. Transparency in Operations — Instruments, Coverage, Access
- Pillar III refers to transparency of central banks conduct as they implement their policies, and relates to instruments used, the scope of operations, and rules of access.
- III.1. Instruments
  - Transparency of instruments involves clear and public articulation of:
    - (a) the set of instruments that the central bank uses to implement its policies;
    - (b) the techniques of applying those instruments; and,
    - (c) the rules under which these operations are conducted.
- III.2. Coverage
  - Relates to the scope of central bank operations in pursuit of the central bank’s policy objectives, including targeted markets and financial institutions that are accredited based on licensing criteria, as defined by law or regulation.
- III.3. Access
  - Relates to clear rules, that are well known, regarding access to, use of, and interaction with central bank instruments by accredited financial institutions.

### Coverage of Operations — Operational categories and disclosure
- Central banks should ensure operational frameworks reflect their de jure and de facto mandates and are transparent to the public in terms of instruments, coverage and access.
- Monetary policy
  - Central Bank transmittal of information to stakeholders on monetary policy instruments and any targets (procedures and practices) used to pursue the central bank’s objective(s), including, inter alia, open market operations, central bank discount and deposit facilities, disclosure of foreign exchange transactions, international reserves management and foreign exchange operations (including assets and liabilities).
  - Note: FX operations are often conducted after a predetermined interval disclosure of selected information on its aggregate market transactions.
- Macroprudential measures
  - Examples to be disclosed in laws or regulations: countercyclical capital buffers; forward-looking loan loss provisioning requirements; restrictions on loan-to-value and debt-service-to-income ratios; additional capital requirements on loans to corporate sector; higher capital requirements for lending in FX; tools to manage liquidity and FX mismatches in the banking system; tools to manage systemic liquidity arising in the non-bank financial sector; additional capital surcharges for systemically important financial institutions.
- Microprudential Supervision
  - Relates to the implementation of the central bank’s supervisory function and the disclosure of information on measures taken in this capacity. May include a possible non-disclosure policy, as established by law.
- Resolution
  - Measures aiming to avoid financial institutions’ failure or crisis, and/or a non-disclosure policy as established in legislation.
- ELA (Emergency Liquidity Assistance)
  - Disclosure of central bank operations established to provide liquidity assistance to financial institutions, under appropriate safeguards, and possible communication to parliament.
- Payment systems
  - Disclosures relating to the oversight function and operation of the payment system.

### Pillar IV. Transparency in Outcome
- Pillar IV relates to reporting requirements of the central bank’s governing bodies (including the governor) to the executive branch, parliament/the legislative power, and the public at large primarily about the policies and decisions adopted by the central bank to achieve its policies or objectives.
- Includes reporting on the implications of not reaching desired objectives.
- Information presented when officials appear before designated public authorities should describe central bank performance in achieving its objectives and exchange views on the state of the economy and financial system.

### Pillar V. Transparency in Official Relations
- Pillar V deals with relationships of the central bank with official bodies relevant for policy effectiveness and accountability, including government, other public institutions, and foreign entities.

- V.1. Government
  - Transparency includes public disclosure of policies allowing or prohibiting credit to the government, and if allowed, the conditions under which the central bank lends to the government (amount, interest rate, and maturity), disclosed on a timely basis so markets can internalize potential impact on systemic liquidity.
  - Includes consultation mechanisms with the government.
- V.2. Other Public Agencies
  - Relates to exchange of information between the central bank and public-sector institutions, particularly agencies with financial sector oversight responsibilities, and other cooperation agreements.
- V.3. International
  - Relates to information on international or bilateral relationships that serve an economic or financial objective and may give rise to mandatory obligations (e.g., cross border supervision, IMF Article IV), voluntary actions (e.g., SWAP lines), or consultative relationships.

### Annex II. Central Bank Transparency Framework: Case Studies — aggregate findings (sample set)
- The annex presents results of applying the proposed CBT framework to the sample set of 24 central banks. For each category, individual assessments were aggregated following the described methodology.

- Pillar I. Transparency in Governance — Legal Status
  - 1. All central banks are transparent about their legal personality. Legal personality is always defined in the central bank law. Most central banks are also transparent about the legal framework governing the central bank in general, though a few cases lack transparency.
  - 2. Only a small number of central banks is transparent about legal immunities for their management and staff. Out of 143 countries and monetary unions of which the central banks laws are listed in the IMF’s CBLD, only 53 percent contains at least one explicit reference to liability arrangements.
  - Observation: Central banks are generally not transparent about legal immunities on their own websites; some immunities may be provided by other domestic laws.

- Central Bank Mandate
  - 3. All central banks are transparent regarding their price stability and payment systems objectives; these are embedded in central bank law.
  - Not all central banks offer full transparency for ELA as a financial stability function; arrangements for ELA are highlighted by most central banks in central bank laws but can be unclear in some cases, with some ad hoc arrangements.
  - Ad hoc responsibilities are common for consumer protection, and occasionally for financial integrity.
  - Note: For some objectives multiple laws (“CB Law” and “Other Law”) contain arrangements—mostly in micro and macroprudential supervision, and payment systems.

- Central Bank Autonomy
  - 4. Transparency on functional and financial autonomy is well-established; less so on institutional/operational autonomy.
  - Near to all central banks are transparent about their functional and financial autonomy.
  - Little more than half of central banks are transparent regarding personal autonomy.
  - Less than half are transparent regarding institutional/operational autonomy.
  - Comment: Lack of transparency on operational autonomy may reflect that such arrangements are embedded in laws other than the central bank law.

- Central Bank Decision-Making Structures
  - 5. Next to all central banks are transparent about their decision-making structures.
  - The central bank Board/Council is most often the key decision-making body, specifically for price stability and payment systems, though dedicated bodies for monetary and macroprudential functions are also common.
  - For resolution, financial integrity and consumer protection many central banks indicate institutional arrangements are not applicable.

- Central Bank Internal Accountability — reporting and auditing
  - 6. Most central banks are transparent about their financial statements and annual reporting to government. Central bank laws or websites provide information on duty to submit annual report and annual statements to government. In near to all cases this is done based on a legal obligation, though in two cases it is not clear if there is such a legal obligation.
  - 7. All central banks are transparent about whether they publish an annual report and report financial statements to government. In only two cases the central bank is not transparent about whether it publishes some/a summary of its audit report findings, which in most of those cases is based on an explicit legal obligation.

- Internal Accountability — ethics and codes of conduct
  - 8. Central banks are not very transparent about ethics or codes of conduct requirements. Most central banks are not transparent about whether they have an ethics committee (or other ethical oversight). Most are not transparent about existence of a code of conduct for Board members and/or staff.

- Central Bank Risk Management
  - 9. One-third of central banks is not transparent about their internal risk management.
  - Transparency is divided into:
    - (1) risk appetite, risk policies, and risk framework; and
    - (2) risk management decision-making structure.
  - In both categories, one-third of central banks is not transparent about whether these exist. In two cases, central banks indicated neither category is applicable.

- Central Bank Communication Strategy and Policy
  - 10. Almost all central banks are transparent about their institutional communication arrangements. Except for two central banks, all have published information on institutional communication arrangements.
  - Most central banks are transparent on existence of policies or legal obligations to inform the public.
  - Less than half of central banks are transparent on whether they have undergone publishing/reporting enhancements.

- Central Bank Secrecy and Confidentiality
  - 11. Almost all central banks are transparent about general secrecy and confidentiality rules for central bank staff. With two exceptions, most central banks indicate general secrecy and confidentiality rules are established in central bank law and applicable to staff.
  - About 60 percent are transparent about specific rules for Board members’ secrecy and confidentiality arrangements.
  - Less than half are transparent about specific financial stability-related secrecy and confidentiality rules in central bank law; in five cases these arrangements are not applicable.

- Pillar II. Transparency in Policies (summary)
  - 12. Near to all central banks are transparent about policy areas relating to payment system policy, monetary policy, and macroprudential oversight.
  - In many cases, central banks are transparent about not having a mandate on financial integrity, consumer protection, microprudential supervision, and resolution.
  - Transparency is lacking predominantly on financial integrity policy (where part of the mandate), and to a lesser extent on ELA, consumer protection, and microprudential supervision.

*Source: ppea2019011 - "The legal framework, institutional arrangement(s), and mandates for supervisory activities" (content extracted from the provided PDF).*

### 13.      All central banks are transparent about monetary and payment systems operations,

### 13.      All central banks are transparent about monetary and payment systems operations,

### Transparency in Operations — Findings
- All central banks are transparent about monetary and payment systems operations.
- Central banks lack transparency in particular on operations relating to ELA, financial integrity, and consumer protection, and to a lesser extent on macroprudential and microprudential, as well as resolution.
- Financial integrity, and consumer protection seem to be areas where central bank operations are not always transparent.
- In part this could be related to the lack of an explicit mandate (see above).
- For ELA, there is also a large number of central banks that are not transparent on their operations.
- As noted above, this could be related to the perceived need for certain ambiguity on ELA (mandate, policy, and operations) to avoid moral hazard (Figure 12).

### Transparency in Outcome — Findings
- Central banks are mostly transparent about the outcomes of their policies and operations price stability.
- For price stability outcomes, this transparency holds for reporting to parliament and to the minister.
- However, regarding target, operations, and activities relating to price stability, half of all central banks are not transparent.
- Similar large transparency gaps occur in reporting to parliament on outcomes of consumer protection and financial integrity for almost all central banks that have these objectives (see mandate above).
- More than half of the central banks does not report to parliament on outcomes of their payments system objective.
- The same holds for a couple of financial stability cases (Figure 13).

### Transparency in Official Relations — Findings
- Central banks are mostly transparent about relationships with the government, with the notable exception of the credit function.
- This transparency holds for the cashier, depository, and agency functions of the central bank.
- Transparency on the credit function of the central bank to government is lacking in more than half of the country cases.
- This could relate to the sensitivity of the central bank providing direct or indirect credit to government, and therefore providing fiscal financing—which could be at odds with the central bank’s explicit legal mandate (Figure 14).
- In several cases, the central bank is also not transparent about its consultation with government.

### Annex III — Central Bank Transparency Code and Alignment with Other Standards
- The Central Bank Transparency (CBT) Code will rely on other relevant international standards or principles that contain transparency requirements or recommendations, insofar as these apply to cases where the central bank is also a financial (banking and/or insurance) supervisor, and/or securities’ supervisor, and/or financial market infrastructure.
- Core Principles for Effective Banking Supervision (BCBS)
  - Examples of Transparency Requirements (selected): “The operational independence, accountability and governance of the supervisor are prescribed in legislation and publicly disclosed”; “The process for the appointment and removal of the head(s) of the supervisory authority and members of its governing body is transparent”; “The supervisor publishes its objectives and is accountable through a transparent framework for the discharge of its duties in relation to those objectives”; “The supervisor has effective internal governance and communication processes... The governing body is structured to avoid any real or perceived conflicts of interest.”
  - CBT Equivalent: Pillar I (e.g., mandate, autonomy, decision-making structures, communication, codes of conduct/conflicts of interest, legal protection). Pillar IV (outcome).
- Insurance Core Principles (IAIS)
  - Examples of Transparency Requirements (selected): “Primary legislation clearly defines the authority (or authorities) responsible for insurance supervision”; “Primary legislation clearly defines the objectives of insurance supervision and the mandate and responsibilities of the supervisor...”; “The governance structure of the supervisor is clearly defined. Internal governance procedures, including internal audit arrangements, are in place to ensure the integrity of supervisory actions. There is effective communication...”; “There are explicit procedures regarding the appointment and dismissal of the head of the supervisor and members of its governing body... When the head of the supervisor or members of its governing body are removed from office, the reasons are publicly disclosed”; “The institutional relationships between the supervisor and the executive and judicial authorities are clearly defined and transparent...”; “The supervisor and its staff are free from undue political, governmental and industry interference in the performance of supervisory responsibilities...”; “There are clear and transparent regulatory requirements and supervisory procedures which are appropriate for the objectives that they are intended to meet... These regulatory requirements and supervisory procedures are published”; “The supervisor publishes information on the insurance sector, about its own role and how it performs its duties.”
  - CBT Equivalent: Pillar I (e.g., mandate, autonomy, decision-making structures, communication, codes of conduct / conflicts of interest, legal protection). Pillar IV (outcome). Pillar V (Official Relations).
- Objectives and Principles of Securities Regulation (IOSCO)
  - Examples of Transparency Requirements (selected): “The responsibilities of the Regulator should be clear and objectively stated.”; “The Regulator should be operationally independent and accountable in the exercise of its functions and powers.”; “The Regulator should have adequate powers, proper resources and the capacity to perform its functions and exercise its powers.”; “The Regulator should adopt clear and consistent regulatory processes.”; “The staff of the Regulator should observe the highest professional standards, including appropriate standards of confidentiality.”; “The Regulator should have or contribute to a process to identify, monitor, mitigate and manage systemic risk, appropriate to its mandate.”; “The Regulator should have or contribute to a process to review the perimeter of regulation regularly.”; “The Regulator should seek to ensure that conflicts of interest and misalignment of incentives are avoided, eliminated, disclosed or otherwise managed.”
  - CBT Equivalent: Pillar I (e.g., mandate, autonomy, decision-making structures, communication, codes of conduct/conflicts of interest, legal protection).
- Principles for Financial Market Infrastructures (CPMI‑IOSCO)
  - Examples of Transparency Requirements (selected): “An FMI should have a well-founded, clear, transparent, and enforceable legal basis for each material aspect of its activities in all relevant jurisdictions.”; “An FMI should have governance arrangements that are clear and transparent, promote the safety and efficiency of the FMI, and support the stability of the broader financial system, other relevant public interest considerations, and the objectives of relevant stakeholders.”; Principle 22: “An FMI should use, or at a minimum accommodate, relevant internationally accepted communication procedures and standards in order to facilitate efficient payment, clearing, settlement, and recording.”; Principle 23: “An FMI should have clear and comprehensive rules and procedures and should provide sufficient information to enable participants to have an accurate understanding of the risks, fees, and other material costs they incur by participating in the FMI. All relevant rules and key procedures should be publicly disclosed.”
  - CBT Equivalent: Pillar I (e.g., mandate, autonomy, decision-making structures, communication, codes of conduct/conflicts of interest, legal protection).

*Source: IMF Staff.*

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_Source: https://www.imf.org/-/media/files/publications/pp/2019/ppea2019011.pdf_