Various factors can impact the effective functioning of the financial system and render it vulnerable to instability and manipulation, which could affect investor confidence and make it easy for unscrupulous or criminal activities to thrive. A robust regulatory system is, therefore, essential for economic stability and growth, and to ensure the resilience of the financial system, when faced with crises. Regulation, other than fulfilling a control function, also has a role to play in facilitation of opportunities, activities, integration and coordination across the sector.
It is against this background that the Faculty of Law at Stellenbosch University (SU) is pleased to announce a significant donation to establish the Gys Steyn Chair in Financial Regulation Law – the first of its kind in South Africa.
Steyn is a former chair of the SU Council and managing director of the wine and liquor divisions of Remgro, who studied in the Faculty and graduated with a LLB degree in 1956.
“We are hugely indebted to Mr Gys Steyn for his donation of R25 million via a family trust to the Law Faculty Trust towards the establishment of the Chair in Financial Regulation Law," says Prof Wim de Villiers, Rector and Vice-Chancellor. “The donation to establish the Chair assists Stellenbosch University in its vision to be the leading research-intensive university in Africa. Our institution's number of research chairs has increased significantly in the past decade, expanding our research capacity. With this significant contribution from Mr Steyn, the Faculty of Law will be able to deepen its understanding of the complex nature of financial regulatory systems, especially in times of economic turmoil."
“With this new initiative, we aim to contribute constructively towards strengthening the financial sector and its regulation in South Africa," says Prof Nicola Smit, Dean of the Faculty of Law.
The SU Law Faculty Trust and alumni of the Faculty of Law fulfil an important role in advancing excellence in the Faculty, as evidenced by this new chair, which follows their previous involvement and sponsorship of the Chair in Social Justice and the Chair in Urban Law and Sustainability Governance.
Mr Chris Otto, Chair of the SU Law Faculty Trust,* commented that “an efficient financial system is crucial to ensure stable and sustainable economic growth, and, as such, financial institutions and structures operating within the financial system need to be regulated to ensure that they are well governed and managed. The South African financial system is always exposed to risks, which may stem from a range of sources, both locally and globally. It is also an open and connected financial system, where the difficulties or failures within one institution can have significant consequences on the entire system. Prudent management of the financial system via the proper regulatory instruments are, thus, essential."
Faculty of Law
“The SU Faculty of Law has a long and proud tradition of excellence in producing legal practitioners, jurists and thought leaders who are committed to maintaining and strengthening democracy —and society— in South Africa and the world," says Smit. Furthermore, “As we celebrate more than 100 years of legal education, we continue to strive to be a leader in legal education and research, whilst making a positive impact on society through engagement in our fields of expertise."
Smit further says that “We, thus, believe that we are ideally placed to make a valuable contribution towards scholarship — and by extension, the practical implementation of financial regulation measures, both within South Africa and internationally — through the establishment of the research chair."
The activities of the Chair will support, strengthen and improve scholarship in the field of financial regulation to produce high-quality research outputs and postgraduate students.
“The Chair will focus on the theory, purpose and principles of regulation in general, and specifically financial regulation law," Smit explains. “This will incorporate aspects such as the economics of the financial sector, models of regulation, regulation of different risks in the financial sector, and regional and international financial regulation law."
A significant challenge is the vast scope of the field of financial regulation, given its many inter-related aspects and fields. It is nearly impossible for one person to have comprehensive expertise, and to be considered the leading authority across the entire spread of the inter-related fields. However, the Faculty's vision is that with a Chair in Financial Regulation Law, a senior expert can create a hub around which more focused expertise (both academic and professional) may be co-opted in the various areas of financial regulation.
Smit adds that the Chair will also investigate the nature and regulation of technology used in financial markets (so-called “fintech") to promote the efficient and effective use of these technologies, and how these technologies disrupt traditional financial services and their regulation. Topics such as the regulation of digital financial products and digital money (including cryptocurrencies), the prevention of the abuse of the financial system, comparative aspects of financial regulation across jurisdictions, and the international context of financial regulation from a South African perspective will also fall within the ambit of the Chair.
The Faculty is about to start the recruitment process and a formal launch of the new Chair will take place in due course.
*The Law Faculty Trust, created in 2013, supports several projects in the SU Faculty of Law, including but not limited to bursaries for postgraduate students that enrol for LLM (research) and LLD degrees. The Trust also provides support to academic staff, including funding for study opportunities, (international and national) research initiatives, such as conference presentations and hosting of research seminars. A further important project is the recruitment and retaining of academic staff, with the establishment of the Chair in Social Justice (2018) with Prof Thuli Madonsela as first incumbent an example.