Accountability and transparency
Accountability
To help the ECB carry out its mandate to guarantee price stability, it has been granted political
independence. But this independence needs to be balanced with accountability.
Accountability is
the legal and political obligation of the ECB to explain and justify its decisions to the citizens
of Europe and their elected representatives.
Accountability is enhanced by a high degree of transparency.
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Transparency
Transparency means providing the public with all relevant information on the ECB's strategy, assessments and policy
decisions as well as on its procedures in an open, clear and timely manner.
The ECB considers a high level of transparency as crucial for the effective conduct of monetary
policy for three main reasons:
- Credibility: when monetary policy is well understood and a central bank is perceived
as able and willing to achieve its policy mandate, price expectations are better anchored.
- Self-discipline: facilitating public scrutiny of monetary policy actions is a
strong incentive for the decision-making bodies to fulfil their mandates in the best possible manner.
- Guidance to markets: Market participants can better understand the response pattern
and thus anticipate the broad direction of monetary policy over the medium term. This in turn can
shorten the transmission process and thus make the ECB's monetary policy more effective. It also
reduces the incidence of major policy surprises and thereby helps to smooth market developments.
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