PARTICIPANTS
James Ellis, Sid Drell, Ken Scott, George Shultz, John Taylor, Emily Warren, Frank Wolak, Ian Wright
ISSUES DISCUSSED
James Ellis, retired 4-star United States admiral and former chief executive officer of the Institute of Nuclear Power Operations (INPO), explained how INPO became an effective industry regulator and then led the assembled working group in a discussion of how regulation in the financial sector could be improved, based on INPO’s regulatory model. Ellis began by giving background on the structure of INPO and how it was formed, explaining that it’s primary goal is to achieve self-regulation of the nuclear power industry by a non-profit organization formed by companies that make up the majority of nuclear energy production in the United States. Five factors enable INPO to be successful in reaching this goal: direct engagement of INPO leadership with company CEOs, having a single mandate (nuclear safety), infrastructure supporting regulation (evaluations, advisory groups, peer evaluators, etc.), direct and frequent accountability of companies to INPO leadership and the independence of INPO from any single nuclear energy company. The working group then discussed how and whether or not this same structure could be applied to regulating the financial sector. The competitive landscape, trade secrets, complexity, and lack of unity were all highlighted as challenges to constructing a similar regulatory body in the financial sector. However, in areas such as stress testing, where companies are to conduct their own tests, in addition to the government conducting them, it was argued that perhaps this structure could be useful, as a single regulatory body could act as a repository of models and resources to evaluate stress on any given company.
