THE RELATIONSHIP BETWEEN CENTRAL BANK INDEPENDENCE AND ITS CORPORATE GOVERNANCE
Abstract
The article examines the relationship between central bank independence and its corporate governance. The term of "central bank independence" has been defined and the main aspects of this relationship are identified. The emphasis is on the need to combine independence with democratic accountability and transparency, which ensures a balance between autonomy in decision-making and responsibility to society and legislators. The purpose of the article is to determine how the key elements of corporate governance - transparency, accountability, decision-making structure, appointment procedures, and control mechanisms such as internal and external audit - affect the level and practical implementation of central bank independence. Methodology of research. The achievement of the purpose set in the article is carried out with the help of the following research methods: logical generalization and scientific abstraction, structural analysis, analytical method. A generalization of scientific approaches of domestic and foreign scientists was carried out. The IMF Code of Good Practices on Transparency in Monetary and Financial Policies was analyzed. Findings demonstrate that effective corporate governance is a fundamental precondition for real central bank independence. Transparency and accountability serve as internal safeguards of autonomy, ensuring a balance between operational independence and democratic legitimacy. Meanwhile, collegial decision-making, clear distribution of powers, independent leadership appointments, internal and external audit, and risk management mechanisms strengthen institutional resilience and credibility. Corporate governance transforms formal autonomy into genuine functional independence of the central bank. The practical value of the results lies in the possibility of applying the proposed conclusions to improve the corporate governance system of the National Bank of Ukraine, enhance transparency and accountability, and align national practice with international standards, thereby strengthening the institution’s credibility and effectiveness.
References
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