Performation and Supervision of the Financial System

Christian WALTER Actuaire agrégé, Institut des actuaires ; directeur, Chaire « téthique et finance », Faculté des sciences sociales et économiques (FASSE), Institut catholique de Paris (ICP).

Supervision of the financial system must take into consideration the effects of management tools and in particular the ones representing risk. Real machinery of the professional finance, management tools have several and simultaneous effects: organizational (control procedures), institutional (international regulatory standards), technical (valuation methods) and cognitive (the way of thinking uncertainty in order to shield oneself against it). The shaping of the financial activities by the technical and mental tools is called performation. It is of the highest importance to have a better understanding of the role of this performation in the 2007-2008 financial crisis to get protected against future crises.