BRUSSELS – The European Ombudsman advised on Wednesday the president of the European Central Bank to stop participating in meetings of the Group of 30, a private group of central bank governors, in a statement posted on the ombudsman’s official website.
Emily O’Reilly recommended ECB President Mario Draghi suspend his attendance of G30 meetings over concerns it could undermine confidence in the independence of the institution, and warned future ECB presidents not to become members of the group.
“The ECB takes decisions that directly affect the lives of millions of citizens,” said O’Reilly in a statement. “In the aftermath of the financial crisis, and in consideration of the additional powers given to the ECB in recent years to supervise member state banks in the public interest, it is important to demonstrate to that public that there is a clear separation between the ECB as supervisor and the finance industry which is affected by its decisions.”
The G30 is a Washington DC-based private organization, whose members are central bank governors, private sector bankers, and academics.
Among its members are the governors of the central banks of England, Japan and China, private high-ranking bankers at UBS, Crédit Suisse and JP Morgan, and academics such as Paul Krugman.
“The ECB can, of course, interact with the G30, as it does with any other stakeholder, in order to improve policy-making by listening to a broad range of viewpoints,” said O’Reilly, adding that these interactions should be “as transparent as possible and not based on membership, which, with that implied closer relationship, undermines the very positive transparency steps the ECB has made in recent years.”
O’Reilly also suggested the ECB chief only participate in some G30 meetings, as in the case of Janet Yellen of the US Federal Reserve.
The European Ombudsman opened an investigation on Jan. 20, 2017, to establish the links between the G30 and the ECB after a complaint was presented by the NGO Corporate Europe Observatory.
The Corporate Europe Observatory’s monetary and financial policy researcher Kenneth Haar celebrated the EU watchdog’s decision: “The Ombudsman’s decision is timely and very positive. President Draghi’s involvement with the Group of 30 was ill-advised from the start.”
Besides her recommendations on the G30, the O’Reilly proposed that all executives be accompanied by an ECB staff member at all G30 meetings and seek the implementation of a new code of conduct for the bank’s governing council members.