A board of directors has the responsibility to understand the legal, reputational, and compliance risks facing an organization; legal professionals can assist in identifying those risks, quantifying them, and providing expertise in managing them. Before a company moves into new and higher-risk areas, the boards of directors and management need assurances that the organization's governance practices are sound and effective.
The logical corollary is that we need to compensate for these “missing institutions” by establishing a much stronger financial and economic union. One area in which the absence of stabilising institutions has been keenly felt is that of current account imbalances within the euro area. These imbalances existed before the crisis for many years, although many said they were irrelevant in a monetary union.