literature shows that the institutional setup of the board indeed matters for monetary policy ( morgan, 2005 ; maier, 2010 ; sibert, 2006 ) suggesting guidelines for optimal committee design. thus, according to maier ( 2010 ) the optimal committee should have clear objective and independence ; should not be too large in size ( up to five members ) and have measures to avoid free - riding and discourage polarization and group think. when it comes to practice, the number of decision - makers, decision - making protocol, and principals in attendance diverge markedly among the leading central banks, suggesting for committee dynamics to be appropriately adjusted conditional on the institutional set - up and specifics of the central bank. bis central bankers ’ speeches

implications of financial stability tasks on central bank governance, bis ( 2009 ) underlines the need for effective governance arrangements that should be designed to deliver sustainable conduct of monetary policy functions in combination with the additional mandate to contribute to financial stability. further, the report stresses the importance of clarity with respect to financial stability responsibilities, policy transparency as to promote accountability, full autonomy to safeguard against political pressures and undue influence from business and industry and close collaboration with other regulators in the country. another important aspect is the central bank balance sheet which should be sound enough with strengthened risk - bearing capacity to enable successful implementation of monetary policy and support financial stability in case of emergency. going back to banking supervision, besides the institutional setup, another important question raised by the crisis relates to the role of transparency and accountability in promoting more effective banking supervision. according to the literature, for supervision to be considered effective it should be able to effectively develop, implement, monitor and enforce supervisory policies under normal and stressed economic conditions. bis ( 2012 ) defines several preconditions for effective supervision in practice : 1 ) sound and sustainable macroeconomic policies as a core precondition for stable financial system ; 2 ) a well established framework for financial stability policy formulation i. e. clear framework for macro prudential surveillance and financial stability policy formulation ; 3 ) proper regulatory environment ; 4 ) a clear framework for crisis management, recovery and resolution ; 5 ) an appropriate level of systemic protection ( or public safety net ) such is a system of deposit insurance which contributes to public confidence in the system and thus limit contagion from banks in distress and 6 ) effective market discipline. transparency is another factor that gains growing importance in recent years. thus, in order to restore confidence and rebuild financial stability there was a strong push towards supervisors to increase their transparency to the markets and the public. one supporting argument for these trends is the role of transparency as prerequisite for accountability. higher transparency enhances the legitimacy of the supervisor, also safeguarding his independence. when transparent, the supervisory actions become more predictable thus helping to shape expectations and foster linkages across institutions and markets. finally, transparency sets the ground for careful and consistent decision - making, reducing the scope for arbitrary decisions. empirical research ( arnone et al., 2007 ), finds a positive correlation between the transparency of the supervisor and the effectiveness of banking supervision. they also report higher transparency of banking supervision ( based on adherence to the imf code ) in industrial countries than in emerging economies.