There is a case to move to a quarterly cycle as obtains in advanced and emerging market economies and to have large institutions publicly explain their results to their shareholders and the investing public. Market discipline Of course increased disclosure is critical to fostering market discipline which plays an important role in ensuring proper risk management.
Effective market discipline plays a part in restraining companies from taking excessive risk. The absence of market discipline creates a moral hazard problem as too much emphasis is placed on the Regulator. Regulatory authorities as well as financial institutions could facilitate greater market discipline by promoting financial education programmes which increase the level of financial literacy and confidence of the consuming public.