In the European Union, the European Central Bank (ECB) is the key central banking body responsible for administering monetary policy throughout the eurozone. It is a crucial component of the European Union and comprises the central banks of all EU member states. The ECB was established in 1998, and since 2011 it has been headed by Mario Draghi.
Draghi currently serves as president of the European Central Bank, but his career prior to this position is an illustrious one. Before he rose to this position, he also served as a governor of the Bank of Italy, as a former member of the World Bank, and as a managing director of the international division of Goldman Sachs.
Draghi was born in Rome, Italy. His father was a career banker as well. As the oldest of three children, he studied economics at the Massimiliano Massimo Institute and La Sapienza University, going on to earn a Ph.D. in the subject at the Massachusetts Institute of Technology.
Early in his career, Draghi served as a faculty member at institutions including the University of Florence and the John F. Kennedy School of Government at Harvard University.
Career at the World Bank, Italian Treasury and Goldman Sachs
From 1984 through the early 2000s, Draghi worked for a number of notable global banking institutions. He was the Italian Executive Director of the World Bank from 1984 through 1990.
For the subsequent 10 years, from 1991 through 2001, he was general director of the Italian Treasury. As part of his work for the Treasury, he headed the committee which revised and renovated Italian corporate and financial legislation. His experience as a board member for a number of Italian banks and corporations, including Banca Nazionale del Lavoro and Istituto per la Ricostruzione Industriale, was crucial at this time.
From 2002 through 2005, Draghi became vice chairman and managing director for Goldman Sachs International. In this capacity, he developed the company's strategy in the European market and worked closely with both large European corporations and European governments.
Bank of Italy
Following his stint at Goldman Sachs, Draghi returned to the governmental side of banking. He became governor of the Bank of Italy in late 2005 and, a few months later, was elected to the position of Chairman of the Financial Stability Forum.
The Financial Stability Forum (later renamed the Financial Stability Board in 2009 on the request of the G20 membership) was responsible for bringing together members of central banks and governments to investigate and promote financial stability across national borders. Draghi served as governor of the Bank of Italy until late in 2011.
European Central Bank
In his capacity as governor of the bank of Italy, Draghi worked closely with then-president of the ECB, Jean Claude Trichet, to develop economic policy recommendations for the Italian government. In part because of this close collaboration, Draghi was frequently mentioned as a potential successor to Trichet, whose term ended in late 2011.
Throughout 2011, financial publications around the world took positions of support for various candidates for the President post. Although Draghi was dismissed by some, including German weekly paper Die Zeit, others, including The Economist and Germany's Bild, suggested that Draghi would be the best candidate for the position.
In May 2011, the Council of the European Union adopted a recommendation to nominate Draghi to the Presidency of the ECB. The European Parliament and the ECB itself approved the nomination, confirming his appointment in June 2011. Draghi assumed leadership of the post when Trichet's eight-year term expired at the end of October 2011.
Draghi has a similar, non-renewable eight-year term and will be president of the ECB through October 31, 2019. It is expected that the decision-making process for his successor will begin in earnest in the early months of 2019.
As president of the ECB, Draghi has played a major role in a number of significant economic developments. In December 2011, shortly after assuming office, he oversaw a $640 billion, three-year loan from the ECB to European banks. He has also been closely involved with Greek debt restructuring.
In February of 2012, Draghi initiated another round of loans from the ECB to European Banks. (See also: Mario Draghi: Central Banks Can't Do It All.)
A portion of Draghi's activity as ECB president has been to advocate for the continuation of the eurozone. In 2015, he suggested that the EU countries had "not yet reached the stage of a genuine monetary union," adding that this would potentially jeopardize the "long-term success of the monetary union when faced with an important shock."
Draghi has been an outspoken proponent of improved economic performance for eurozone countries. (See also: Why These European Countries Don't Use the Euro.)
Mario Draghi has faced criticism in his position with the ECB, largely because of his ties with Goldman Sachs and because of his membership in the so-called Group of Thirty, a private group of financial lobbyists.