Updating Europe’s regulatory and supervisory framework for the digital age
How should the EU’s financial regulatory and supervisory framework evolve to remain fit for purpose? The landscape is undoubtedly changing: “The application of innovative technologies is facilitating changes to the structure of the EU financial sector. Value chains are evolving, the use of digital platforms is growing rapidly and new mixed-activity groups are emerging.”
The three European Supervisory Authorities (ESAs) – the European Banking Authority, the European Insurance and Occupational Pensions Authority, and the European Securities and Markets Authority – have produced a joint report recommending a series of actions to strengthen regulation and enhance supervisory capabilities in the light of these changes, in response to a Call for Advice from the European Commission. The proposals aim to maintain a high level of consumer protection and address emerging risks.
Our initial reading suggests that while the report offers insights on enhanced consumer-focused disclosures, it does not call for a truly digital format that would produce machine-readable information. We at XBRL International believe that disclosures aimed at consumers – as well as, for example, regulators – should have a digital element to facilitate comparison and analysis. This seems likely to be an increasing area of focus in the future, and we hope that we – and our readers – will have opportunities to lobby for more digital thinking in this arena, in keeping with the progress in digitisation in other aspects of European reporting.