The UK – which hosts the world’s largest commercial insurance market and is home to the largest number of banks – must contribute to the development of the global regulatory agenda.
This is the case being made by the International Regulatory Strategy Group (IRSG), saying it is in the interests of the UK financial services industry, policymakers, and regulators to ensure that global regulatory and standard-setting frameworks for the sector can evolve and deliver effective outcomes in the most efficient way over the coming years.
In a new report, the IRSG said the UK government, along with regulators and the industry, should enhance engagement at a global level. Another primary recommendation is for the practitioner-led group to form a standing committee on the global regulatory architecture.
“A decade on from the financial crisis we take for granted the global framework for financial regulation,” noted Mark Hoban, chair of the IRSG Council. “The Pittsburgh G20 declaration has shaped much of the new regulation affecting our sector today. Global regulation now goes hand in hand with global businesses.
“A coherent regulatory framework helps address the risks of market fragmentation, regulatory arbitrage, and global financial instability but also improves efficiencies for firms, benefiting consumers.”
According to the IRSG, it is critical that the UK regulatory environment remains connected and competitive within the broader global system. Its report is aimed at stimulating and creating a structure for an ongoing industry-led dialogue on the significance of international regulatory coherence.
“It is important for industry, including via the relevant trade bodies and associations, to identify areas of inconsistency, gaps, and unintended consequences that might arise from the application of global standards, and seek to provide evidence of the impact of these inconsistencies on markets, consumers, and end users alike,” said the IRSG, which is co-sponsored by TheCityUK and the City of London Corporation.
