By Ralf Huber
For decades, lawyers such as myself have been mastering the art of interpreting regulation for financial services, but in a rapidly digitizing world, regulatory interpretation must also become binary. Moreover, a new wave of new RegTech solutions is just around the corner.
Dealing with regulations has sometimes felt like being caught in the treadmill: regulatory implementation project after regulatory implementation project, numerous unclarified case-by-case requests in between, more and more unhappy business stakeholders and clients – and no comprehensive solution in sight. For almost a decade, the industry has been trapped in a regulatory crisis.
While the problem statements around managing regulation remain complex, I am convinced that the following three courses of action would massively lower the pain of the financial industry:
- Financial institutions should give up today’s individual approach to regulations and start an industry-wide collaboration.
- The mindsets of lawyers working for both regulators and the industry itself must shift towards a more machine-readable and standardized interpretation of regulations.
- Instead of further building up legal and compliance teams to manage regulations by hand, the financial services industry should invest in more efficient processes – such as having a ‘digital compliance officer’.
Invest in Industry Standards, Instead of Individual Approaches
When it comes to ...