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In regard to the most important example of a long term project Ms Calviño mentioned the euro. It has been conceived to provide a stable long-term horizon for economic actors in Europe. Despite all the recent difficulties and the talks about disruption, the value of the euro has remained stable. The euro is a solid currency and the underlying economic situation is not so negative – deficit and debt in the euro area are lower than in the US or the UK, for instance.
Obviously there are internal difficulties – and risks - for Europe and beyond. These difficulties are precisely related to how to ensure that the long-term project – the euro – is underpinned by governance and policies that are consistent with its long term nature. And the steps decided by the successive European Councils go precisely in this direction, to provide the right institutional framework to support the currency.
There is still some way to go, but the determination to stand by the long-term project has increased, as all start to realise the costs of abandoning it and to understand its long-term benefits. The shareholders of the euro – Member States, enterprises, citizens – are finally engaging.
One of the core tenets of Corporate Governance is indeed the expectation that shareholders will detect problems and hold management to account for its decisions and actions. On the contrary, "Group think", due to lack of skills, diversity or time devoted, and "short-termism" can dramatically affect the effectiveness of those key actors in their fundamental check and balances duties.
Problems identified are complex and stakes are high. The challenges may be global but, at the same time, practices remain local with significant differences not only across the Atlantic but sometimes for us even within Europe. That is why such dialogue is crucial to exchange, to explain, to benchmark, to compare and at the end to facilitate a better design of political options.
Only promoting short-term capital gains would not help our economies to build tomorrow's competitiveness. Only restoring long term investment within a decent and coherent share could help. But markets are at least on some aspects rational. Long-term investment has a cost: to engage, to perform analysis, to finance a stake generates costs. If those costs are too important regarding the estimated associated benefits, why should investors make any effort? We need to bear in mind that investors are there to make money not to fulfil public interest duties.
Ms Calviño concluded her speech by making a general point on how Europe and the US should cooperate to provide the long-term horizon so necessary for investors and enterprises. Shareholders and investors can engage in the long term only if Europe and the US are capable of showing that they are working together to make the global financial system safer and more transparent. Delays and uncertainties in the US about implementing the Basel agreements to make the banks safer or in adopting international accounting standards send the opposite message.