Financial supervision will need tochange in response to the causes of the financial crisis andthe regulatory proposals arising from it. Supervisors willneed to take a tougher and more challenging approach to thefirms they regulate, exercise more supervisory judgment,involve themselves in macro-prudential oversight, andparticipate more actively in the supervision of firms withcross-border activities. Supervisors in all countries needto take up these challenges, notwithstanding differences inthe style of supervision, in culture and legal tradition, ininstitutional and organizational structure, and in thepowers and resources available to the supervisory agency.