23 september 2013: Research seminar Regulatory Capture: a behavioural perspective

The results of the scientific research project on the functioning of supervisors were presented on Monday the 23rd of September. The research conducted by EBO was based on the responses of 256 supervisors working at DNB and AFM. A central theme was the ‘capture’ of supervisors by the financial sector, generally referred to as regulatory capture. Researchers and supervisors working at DNB and AFM showed great interest in the methodology and a number of surprising findings during the seminar.

Speakers

Jakob de Haan (head research DNB) first explained why scientific research on regulatory capture is important. While there is general consensus on the detrimental effects of regulatory capture in the sense that it thwarts supervisor independence, there is surprisingly little empirical research. Jakob de Haan highlighted that this research project is one of the first scientific studies that actually takes a behavioural perspective on the effects of regulatory capture on the functioning of supervisors.

Dennis Veltrop (researcher DNB) continued with the research methodology employed and explained the results of the research project. Building on social psychological insights it was possible to use questionnaires to gauge the views and the functioning of supervisors. An important outcome was the negative influence of supervisor work experience in the financial sector. This was explained by the degree of social identification with the financial sector (“When I talk about the financial sector I generally say ‘we’ instead of ‘they’). The research also showed that the negative effects of identifying with the financial sector could be ameliorated by fostering a strong professional identity (“Being a supervisor is an important part of who I am”).

Femke de Vries (division director supervision experts centres) provided her vision on the outcomes of the research. She specifically stressed the importance of an independent attitude of supervisors and the way this can best be organized for supervision. It is important to realize that ‘sidelight’ by fellow supervisors should not be considered as a threat and that actively engaging in organizing ‘backtalk’ should be embraced. This does not only hold for individual supervisors but also for management in the sense that it should support, stimulate and reward supervisors that actively search for backtalk.

Success

Regulatory Capture: a behavioural perspective

The seminar provided the audience with new insights that resulted in an animated discussion and numerous questions on the implications and ideas for future research. All in all a fruitful synthesis between science and practice!