For the first time in history, a crisis triggered by US housing finance problems is having global ramifications. Individual companies have drawn lessons from the crisis but common efforts to reform the financial system are the order of the day. The challenge is to extend individual reforms across the financial services industry.

One step towards this goal is the wide dissemination of the final report of the Institute of International Finance’s committee on market best practices (CMBP). This report is the product of intensive efforts during the past nine months involving more than 100 senior executives from more than 65 financial services companies. It contains clear principles of conduct and recommendations for best practice in those areas where serious weaknesses in approaches by many banks were exposed in the market turbulence of the past year – areas such as risk management, compensation policies, liquidity risk, conduit and securitisation issues, valuation, credit underwriting, ratings, transparency and disclosure.