THE QUIET CENTRAL BANK DIPLOMACY AT THE BANK FOR INTERNATIONAL SETTLEMENTS (BIS): WHO GETS VOICE AND VOTE?

Abstract

This paper assesses, from a diplomatic perspective and the point of view of Brazilian interests, the modus operandi of the Bank for International Settlements (BIS). The organization’s banking activities are relatively secondary but contribute to its main goal of promoting central bank cooperation. Through historical inquiry and analytical review, the text examines the working methods of the BIS and identifies factors that explain its resilience for the last nine decades as a prime venue for contact and dialogue between central bankers. The BIS faces the challenge of balancing its traditional secrecy with contemporary requirements for greater transparency and legitimacy. Since the 1990s, the institution has significantly broadened its geographic reach, but the European weight is still disproportionate. Based on a thorough investigation, the article presents the shareholding structure of the BIS, which is not disclosed by the bank and remains anachronistically concentrated in the hands of its founders. In addition to discussing the varied formats of central bankers’ meetings held regularly in Basel, the paper evaluates the representativeness of the organization’s decision-making bodies and the power structure within them. Recent changes in the governance of the BIS, particularly in the composition of its Board of Directors and Management, although relevant, may be considered insufficient. The final section briefly describes Brazil’s participation in the BIS and argues for sustained Brazilian engagement to reinforce the institution’s role as it faces new challenges posed by technological innovation and, more recently, by the Covid-19 pandemic.

Keywords

• bank for international settlements (bis)
• central bank cooperation
• basel process
• governance
• shareholding structure
• voting power