Human resource development functions is integral to the talent management process and in supporting the human capital management strategy. Of equal importance is that this should occur at all levels in the organisation. In essence, the accountability for talent development requires concerted efforts throughout the organization and needs to be embedded as part of the working culture that is communicated, shared and understood at all levels. While the need for human capital development is apparent, what is less apparent are the appropriate methods and policies that should be adopted to advance human capital development. The financial services industry needs to identify the appropriate strategic direction for human capital development. Attention need to be given to the entry level, to the specialists and to the senior management levels. This would benefit from greater industryuniversity linkages which is a major channel through which the talent requirement and talent gap can be narrowed. The industry involvement in the curriculum design and delivery will ensure graduates are equipped with the relevant knowledge and skills that meet the requirements of the industry. Participation by the industry players may be in the reform of the academic curriculum and methodologies and in providing other forms of practical support to the institutions of higher learning. This will contribute directly towards meeting the human capital needs for the future. The quality of human capital is the cutting edge of competitiveness.
The Bank’s role is recognised in the Memorandum of Understanding agreed between the Bank, the Treasury and FSA and published in the Autumn of 1997, which sets out how the three organisations are to cooperate in monitoring the UK financial system. To this end, the MOU established a tripartite Standing Committee which meets monthly to discuss issues of current concern; and cooperation is further enhanced by the fact that I sit on the FSA Board and Howard Davies is a Member of Court. Coordination is also important internationally. The Asian Crisis in 1998 demonstrated how quickly shocks could pass between markets. One response from the international financial community was the establishment of the Financial Stability Forum, a body similar in purpose to the Standing Committee. The Forum meets semi-annually, bringing together central banks, regulators and finance ministries from developed and developing countries, to discuss the threats to financial stability. The Bank is an active participant in the FSF, along with HMT and FSA. Having described the organisational structure, I want to turn now to the four broad areas where the Bank is involved in financial stability. The first is the analysis of developments in G10 and emerging market economies and financial markets and the potential impact on financial stability. Macro-prudential surveillance is at the core of the Bank’s financial stability effort, bringing together detailed knowledge of the macroeconomic environment and financial markets to identify potential vulnerabilities in financial systems in aggregate.