The Optimal Institutional Structure of the Central Bank for Financial Stability in Iran

The money production factory in every country is the central bank and the quantity and quality of this production depend only on the rationality and ethics of policymakers and bankers. The central bank can be considered as one of the institutions of political economy that has a close relationship with democracy. According to the relations governing the election of the president, also, one of the responsibilities that the people entrust to the head of state is to protect the assets of the people and the country. When the major part of these assets through the central bank channel undergoes fundamental changes on a large scale, improving the structure of the central bank is inevitable to create financial stability in the country. The main goal of this article is to reach a suitable governance framework in the central banking of Iran by using the corporate governance methodology. In order to institutionalize corporate governance in the central bank, first of all, people should be accepted as the main owners of this institution. The people who have entrusted this right to their elected officials whom are expected to observe the principles of religious democracy, should be accepted as the main owners of this institution. Who have entrusted this right to their elected officials with the principles of religious democracy. In the form of a new system of accountability, the people's elected officials should be responsible for the most important mission of the central bank, i.e. financial stability and maintaining the value of the national currency, and provide the structure for its realization. In order to design a new structure in the banking system of the country, it is necessary to comply with these issues: improving the pillar of the General Assembly, changing the executive role of the board of directors, defining a specific mission for the pillar of the Money and Credit Council, the necessity of creating a pillar of the Supreme Council of  the Banks, improving financial discipline and independence of the maintaining the financial stability and the value of the national currency Central and operating banks.