Really responsive risk-based regulation

Regulators in a number of countries are increasingly developing "risk-based" strategies to manage their resources, and their reputations as "risk-based regulators" have become much lauded by regulatory reformers. This widespread endorsement of risk-based regulation, together with the experience of regulatory failure, prompts us to consider how risk-based regulators can attune the logics of risk analyses to the complex problems and the dynamics of regulation in practice. We argue, first, that regulators have to regulate in a way that is responsive to five elements: (1) regulated firms' behavior, attitude, and culture; (2) regulation's institutional environments; (3) interactions of regulatory controls; (4) regulatory performance; and (5) change. Secondly, we argue that the challenges of regulation to which regulators have to respond vary across the different regulatory tasks of detection, response development, enforcement, assessment, and modification. Using the "really responsive" framework, we highlight some of the strengths and limitations of using risk-based regulation to manage risk and uncertainty within the constraints that flow from practical circumstances and, indeed, from the framework of risk-based regulation itself. The need for a revised, more nuanced conception of risk-based regulation is stressed

Towards an Economy of Higher Education

This paper draws a distinction between ways thinking and acting, and hence of policy and practice in higher education, in terms of different kinds of economy: economies of exchange and economies of excess. Crucial features of economies of exchange are outlined and their presence in prevailing conceptions of teaching and learning is illustrated. These are contrasted with other possible forms of practice, which in turn bring to light the nature of an economy of excess. In more philosophical terms, and to expand on the picture, economies of excess are elaborated with reference, first, to the understanding of alterity in the work of Emmanuel Levinas and, second, to the idea of Dionysian intensity that is to be found in Nietzsche. In the light of critical comment on some current directions in policy and practice, the implications of these ways of thinking for the administrator, the teacher and the student in higher education are explored

Don't judge a superannuation default investment option by its name

With the massive decline in savings arising from the Global Financial Crisis (GFC), it is timely to review superannuation fund investment and disclosure strategies in the lead-up to the crisis. Accordingly, this study examines differences among superannuation funds’ default investment options in terms of naming and framing over three years from 2005 to 2007, as presented in product disclosure statements (PDSs). The findings indicate that default options are becoming more alike regardless of their name, and consequently, members may face increasing difficulties in distinguishing between balanced and growth-named default options when comparing them across superannuation funds. Comparability is also likely to be constrained by variations in the framing of default options presented in investment option menus in PDSs. These findings highlight the need for standardisation of default option definitions and disclosures to ensure descriptive accuracy, transparency and comparability

Financial literacy and pension investment decisions

The call for enhanced financial literacy amongst consumers is a global phenomenon, driven by the growing complexity of financial markets and products, and government concerns about the affordability of supporting an ageing population. Worldwide, defined benefit pensions are giving way to the risk and uncertainty of defined contribution superannuation/pension funds where fund members now make choices and decisions that were once made on their behalf. An important prerequisite for informed financial decision-making is adequate financial knowledge and skills to make competent investment decisions. This paper reports the findings of an online survey of the members of a large Australian public sector-based superannuation fund and shows that although respondents generally understand basic financial matters, on average, their understanding of investments concepts, such as the relationship between risk and returns, is inadequate. These results highlight the need for education programs focusing specifically on developing fund members’ investment knowledge and skills to facilitate informed retirement savings decisions