Regulators from across the spectrum have agreed to develop metrics to measure the regulatory burden on the financial services industry.
The move comes after leaders and senior representatives from the Financial Conduct Authority (FCA), Bank of England (BoE), HM Treasury and other regulators acknowledged the need to understand the requirements firms face meeting their changing rules.
However, the leaders did not believe there was any need to cut the current series of regulatory initiatives, saying it was “appropriate”.
‘Analyse regulatory burden’
The details came from minutes of the latest Financial Services Regulatory Initiatives Forum (FSRIF) meeting held on 6 May which was published alongside the latest Regulatory Initiatives Grid.
The minutes noted that attendees discussed plans for the development of metrics, “which could help analyse the regulatory burden on industry”.
“The forum agreed that such metrics would be useful in measuring the impact of initiatives but that further work was needed,” it said.
“The forum aims to seek feedback on these metrics once they have been further developed.”
It continued: “The forum agreed that the operational burden of initiatives in the preliminary May 2022 Grid is appropriate.
“Members discussed whether it is possible to determine an ‘optimal number’ of initiatives but noted that this is difficult to determine because an initiative’s type, purpose, and where it is in its lifecycle will affect its impact on industry.
“Members agreed that any significant changes to the number of initiatives in future grids must be explainable via analysis,” it added.
Stakeholder views welcome
In their forward to the Regulatory Initiatives Grid, FCA CEO Nikhil Rathi (pictured) and BoE deputy governor for prudential regulation Sam Woods, acknowledged the importance of this approach.
The co-chairmen of the FSRIF said: “As we develop metrics to better assess the impact of initiatives, we would also welcome stakeholders’ views on the impact of initiatives at different stages of their life cycle, such as when a topic is being consulted on versus implemented.
“We appreciate that both create a burden and are keen to explore how best to assess this impact.”