By Nikki Tait in Brussels
July 29 2009
SourceSharon Bowles is about to become one of the most powerful figures in European finance. But the chair- woman of the European parliament's high-profile economic and monetary affairs committee admits she had trouble staying awake when she joined it four years ago.
"I sat there . . . thinking, 'what are they talking about?' I remember it was very difficult to keep awake," Ms Bowles, a British Liberal- Democrat MEP, recalls.
That may seem an inauspicious admission from someone who will play an important role in shaping the slew of new European Union rules to control banks and other financial services institutions, as Europe's regulators try to guard against a repeat of last year's crisis.
Peering out of the yet-to-be- organised clutter of her new corner office in the Brussels parliament building, the 56-year-old still seems surprised at the outcome of this month's post-election haggling. She had wanted to chair the trade committee.
"I asked to have [the] chair of trade if I was up for getting a chair. I certainly didn't ask for this one, because I thought it was beyond reach," she confesses.
Ms Bowles was a member of the prominent "econ" committee in the past parliament and was heavily involved in tortuous negotiations over Solvency II - a sweeping reform package for the insurance industry - as well as legislative safeguards to prevent banks taking undue risks with securitisation.
A patent attorney by background, Ms Bowles turned to politics in the Thatcher era, distressed at what was happening to the technology sector. For years she went through the election mill unsuccessfully, at last taking Chris Huhne's seat in Brussels in 2005 when he went into UK politics.
With that position in the European parliament came a place on the econ committee. "Chris had been doing the implementing regulations for Basel II [bank regulations], so it is probably fair to say that I almost sat and wept in my office."
But an epiphany occurred when an assistant pointed her to the nitty-gritty equations buried deep in the draft legislation.
"'Oooh,' I said, 'now I know what it's all about - and, by the way, some of the correlation factors are wrong . . .' So I've always gone into it from an analytical, mathematical point of view, which has turned out to be quite complementary to the economists and other people on the committee."
Now Ms Bowles will oversee contentious draft EU legislation to regulate hedge funds, and private equity is already on the parliament's agenda. Further changes, including controversial plans for more centralised financial supervision, will follow in the autumn.
An MEP's job is to amend rather than initiate legislation - and, in practice, many of those amendments are made in the committee process. Ms Bowles admits she tends to take a technical approach, but says the devil is in the detail - and that when this is realised, member states may have more in common than first appears.
"There's a big danger in doing the big-picture stuff," she says, citing, for example, sweeping calls for a single European regulator, which tend to overlook the transparency requirements that would inevitably follow.
"We're not going to run into any problems with that in the UK. They'll run into more problems trying to cope with that in other countries - but they haven't realised it yet. They want this grand, big picture, but if you want a European supervisor you have to have absolute frankness in what you are disclosing."
Ms Bowles takes over the chairmanship from Pervenche Berès, a feisty French socialist MEP, and the change has already brought sighs of relief from financial services lobbyists in Brussels representing City interests.
"There's a lot of expertise in the UK which I must necessarily tap, but I do talk to the German and French banks, because you can't craft something which everyone can buy into unless you understand what their fears and problems are - and their markets and problems and expectations are different.
"As a chair I will serve the UK's interests far better by being neutral than I would by trying to be partisan."
One of her first moves has been to broaden the debate on hedge funds and draw committee members' attention to the non-EU aspects of the proposed rule changes.
"For our first meeting, the secretariat said we could get started on the [draft legislation] and have a hearing on hedge funds - and I have to say my reaction was 'Oh no, not again', because I've sat through several [meetings], with the usual suspects saying the same things."
Instead, plans are being made to discuss the issues with visiting US congressmen.
"I'm not saying we've got to do everything America is doing - far from it. But I certainly am saying we've got to understand what America is doing . . . I just want to make sure things are balanced."
CV Sharon BowlesBorn June 12 1953 Educated Reading university and Oxford university Career * Established specialist Bowles Horton partnership with her husband in 1981 * Lib-Dem candidate for Aylesbury in 1992 and 1997; Lib-Dem European candidate for Buckinghamshire and Oxford East in 1994; third on Lib-Dem European list for south-east region in 1999 and 2004 * Became MEP in 2005 and re-elected in 2009 * Member of econ committee in 2004-2009 European parliament. Now chairwoman
Copyright The Financial Times Limited 2009