The result of this recasting of the regulatory agenda is the creation of a new narrative in which a primarily reactive, rules-based approach to compliance is being replaced with a more proactive, principles-based approach. In 2017, financial markets risk management regulations are less based on stringent adherence to ratios and numbers; rather, regulators have bequeathed a certain degree of autonomy to the banks in an attempt to motivate them to become increasingly forward-thinking and proactive in their approaches to regulatory implementation and compliance. As a result of this shift, GreySpark Partners believes that there are now two remits that have emerged as a consequence of the more proactive, flexible approach to regulation:
- an explicit mandate that internal and external sellside market-, trade- and client-derived data be made available to regulators and to the entirety of the public global financial markets community; and
- an implicit mandate that technology solutions be utilised to incentivise new levels of transparency.
This report examines how this shift in regulatory approach from reactive compliance mandates to proactive ones has intensified efforts by a variety of markets participants to pursue the electronification and digitalisation of business and trading models.
