In ViClarity’s recent annual GRC trends report, the company focused on the key trends which are impacting many industries throughout 2024.
According to ViClarity, as we progress through 2024, a pronounced trend in the financial services sector is the growing emphasis on individual accountability within governance frameworks.
International bodies including the Australian Prudential Regulatory Authority (APRA) and the United Kingdom’s Prudential Regulatory Authority (PRA) have pioneered these accountability regimes.
Observations from these bodies highlight enhancements in the cultures and behaviours of regulated firms, propelling other regions to follow suit. The European Commission is currently assessing the potential impacts of an Individual Accountability regime under the Capital Requirements Directive (CRD), while the Central Bank of Ireland has recently activated its new Individual Accountability Framework (IAF), which became law in March 2023.
This shift towards individual accountability is pushing financial institutions towards adopting sophisticated automated systems to manage compliance effectively. As these new frameworks take root, they are expected to significantly influence corporate culture across the sector.
The adoption of generative AI technologies is revolutionising the RegTech sector, offering both opportunities and challenges in the regulatory and compliance landscape. AI’s capability to automate complex compliance tasks, advance risk assessment methodologies, and refine data processing is invaluable. Yet, this comes with the necessity for RegTech firms to address ethical considerations, data security, and privacy concerns comprehensively.
For another consecutive year, managing regulatory obligations across jurisdictions remains a critical concern. The rapid pace of regulatory changes worldwide demands substantial efforts from global compliance teams to keep up. The increasing complexity and volume of regulatory requirements necessitate the adoption of advanced tools, such as AI and comprehensive GRC systems, to stay ahead.
In an environment where compliance stakes are continually rising, financial organisations are striving for a unified approach to manage data integrity, compliance, and risk. The move towards a ‘single source of truth’—an integrated, centralised data management system—is seen as crucial for enhancing decision-making and regulatory adherence.
By consolidating data sources, organisations aim to reduce compliance costs, mitigate operational risks, and avoid potential reputational damage. This strategic focus is essential for maintaining legal and regulatory compliance amidst evolving work dynamics and technological advancements.
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