Featured Product

    ESAs Report on Supervisory Independence of Competent Authorities

    October 18, 2021

    The European Supervisory Authorities (ESAs) published individual reports on the supervisory independence of competent authorities in their respective sectors. Based on the self-assessment of competent authorities, the three reports highlight that the independence of competent authorities is multi-faceted and dependent on a number of legal, institutional, operational, and cultural factors. The three reports take stock of the competent authorities’ independence along the key areas of operational, financial, and personal independence as well as accountability and transparency. The reports seek to factually represent the arrangements and practices reported by competent authorities, without assessing the independence of individual competent authorities.

    The reports set out the following key findings with respect to each area:

    • Operational independence. While the vast majority of competent authorities are established as independent bodies, a few are established under the aegis of a ministry and a limited number are required to reply to requests made by certain public bodies, such as Ministers. Not all competent authorities report being in a position to hire staff at the level needed for the fulfilment of their supervisory tasks.
    • Financial independence. Almost all competent authorities reported adequate funding. However, a variety of funding models are in operation, with some being subject to centralized government budget rules and a few allowing for the creation of reserves.
    • Personal independence. While a framework is in place at most competent authorities, there are differences on aspects such as terms of office and removal conditions for competent authorities’ senior management and board members, management of conflicts of interest, cooling-off periods, and legal protection for staff.
    • Transparency and accountability. Competent authorities typically ensure public transparency through the publication of documents such as annual reports or financial statements, disclosing supervisory measures taken, and through duties to report periodically on their activities to a government entity or democratic assembly. Some publish documents in English as a way to enhance transparency.

    EBA will use these findings to consider, together with ESMA and EIOPA, how to further develop the monitoring and fostering of supervisory independence. Potential activities might include monitoring supervisory independence through periodic surveys, monitoring conflicts of interest, establishing common EU-wide criteria for supervisory independence, benchmarking/assessment of supervisory independence, and advice on legislative change. The reports can support competent authorities in assessing whether it might be desirable to seek any legislative or regulatory amendment to further improve the framework underpinning their independence. In addition, the reports may be used by the European Commission as input for its own report on the independence of competent authorities, which it is preparing under the review clauses of the ESAs founding regulations.


    Related Links

    Keywords: Europe, EU, Banking, Insurance, Securities, Competent Authorities, Supervisory Independence, EBA, EIOPA, ESMA, EC, ESAs

    Related Articles

    ESAs Issue Multiple Regulatory Updates for Financial Sector Entities

    The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.

    November 15, 2022 WebPage Regulatory News

    ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments

    The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.

    November 10, 2022 WebPage Regulatory News

    IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets

    The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.

    November 09, 2022 WebPage Regulatory News

    EBA Finalizes Methodology for Stress Tests, Issues Other Updates

    The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups

    November 09, 2022 WebPage Regulatory News

    OSFI Sets Out Work Priorities and Reporting Updates for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.

    November 07, 2022 WebPage Regulatory News

    APRA Finalizes Changes to Capital Framework, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.

    November 03, 2022 WebPage Regulatory News

    BIS Hub and Central Banks Conduct CBDC and DeFI Pilots

    The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.

    November 03, 2022 WebPage Regulatory News

    FASB Proposes Improvements to 2023 GAAP Reporting Taxonomy

    The Financial Accounting Standards Board (FASB) is seeking comments, until November 03, 2022, on the proposed technical and other conforming improvements for the 2023 GAAP Financial Reporting Taxonomy.

    November 03, 2022 WebPage Regulatory News

    ECB Sets Deadline for Banks to Meet Its Climate Risk Expectations

    The European Central Bank (ECB) published the results of its thematic review, which shows that banks are still far from adequately managing climate and environmental risks.

    November 02, 2022 WebPage Regulatory News

    ESAs, ECB, & EC Issue Multiple Regulatory Updates for Financial Sector

    Among its recent publications, the European Banking Authority (EBA) published the final standards and guidelines on interest rate risk arising from non-trading book activities (IRRBB)

    October 31, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8588