Directors' Statement on EU Referendum and Way Ahead

Our Centre, founded in 2010, is an international platform for the discussion of the interface of law and ethics in many areas of legal, regulatory and business interests. We have links with academics and institutions both within and outside the European Union and remain committed to fostering these vital links and important conversations.

The EU Referendum result will undoubtedly entail a complex process of legal and regulatory re-examination of many current arrangements. This is a time which many may see as disruptive. As academic researchers, we are committed to constructively contributing to the process of establishing clear frameworks for managing the legal and regulatory consequences that will unfold.

At this point we wish to set out a few post-Brexit high level principles that we believe should guide our endeavours towards clarifying and stabilising the application of law and regulation in the corporate and financial services sector in particular.

First, we must not engage in indiscriminate deregulation. Regulation inevitably imposes a cost on doing business but it also supplies a public good of governance too. It is important to examine the fundamental objectives served by each regulatory provision in question before wholesale decisions are taken in favour of deregulation. Further, regulatory standards add value to the appeal of quality in British goods and services, and it is important to consider the role of regulation and its support for our economy. In this light, we should remain apprised of the regulatory regimes and development of leading jurisdictions such as the US and EU and consider constructively the lessons that can be learnt.

Second, we believe in the importance of meaningful legal and regulatory alignment that is facilitative for the maintenance of close trading relationships with existing and new trading partners. We see key areas of legal convergence to be highly important for the UK’s bid towards mutual recognition and other forms of favoured trading arrangements in the world. In particular, legal harmonisation in financial services is in line with international developments towards the high prudential standards recommended by the Financial Stability Board, and conduct of business standards maintained in the US and EU. 

Third, the UK has and must continue to develop leadership in the governance of the corporate and financial services sectors. Our pioneering Codes of Corporate Governance and Institutional Investor Stewardship have received many accolades worldwide and have been widely adopted. We are able to continue to offer governance and regulatory designs that are stakeholder-inclusive, proportionate, balanced and well-regarded. 

The Centre is preparing to draft a more detailed White Paper on selected aspects of corporate and financial services law and regulation. We see ourselves positioned to feed into the constructive process of clarifying and stabilising the application of law and regulation, for the long-term good of protecting the UK’s economic interests in a sustainable and responsible manner.