2  In diagnosing the cause of the global financial crisis, a lot of ink has been spilled on the inadequacy of regulation and the trend towards deregulation in the lead up to the global financial crisis. Regulation, especially regulation that recognizes and acts on risks, is crucial.
The financial crisis has shown that in certain instances, the Board – which plays a significant role in safeguarding the corporate governance principles and is ultimately responsible for overseeing the organization and management of the company’s affairs as well as the individual board directors were simply unaware of and did not understand the risks taken by the businesses which they were supposed to oversee.