This chapter examines the complex relationship between financial institutions and the bodies that oversee them. It delves into the critical role of regulators in maintaining financial stability, exploring the tools and frameworks they employ to monitor and control the risks inherent in banking operations. The discussion covers the evolution of regulatory practices and the challenges faced in adapting to a dynamic global financial landscape.

This chapter, drawn from 'The Essentials of Risk Management,' is presented as a practical guide for implementing superior risk management programs. It is written by leading figures with extensive experience in global risk management and corporate governance. The content focuses on practical topics such as governance, compliance, integrated risk management, and hedging market risks, suggesting an authoritative and actionable perspective for professionals in the field.