Regulatory Initiatives Grid charts ‘return to normality’ in financial regulation

The grid was first launched in May 2020 with a second edition published in September 2020 as part of a pilot programme. It lays out upcoming regulatory initiatives and deadlines in  legislation to help firms prepare for implementation.

The forum has now published the third edition (40 page / 2.24MB PDF), introducing a new indicator for initiatives of interest to consumers and consumer organisations, and adding sub-categories to the multi-sector and banking, and credit and lending chapters.

The Financial Reporting Council (FRC) has joined the forum, alongside existing members the Bank of England, Prudential Regulation Authority, Financial Conduct Authority, Payment Systems Regulator, Competition and Markets Authority, The Pensions Regulator and HM Treasury as an observer member.

The FRC has been included as its work has a significant impact on the financial services industry, but the forum does not intend to expand membership further in order to prevent the group and the grid from becoming too "unwieldy”.

Financial services regulation expert Elizabeth Budd of Pinsent Masons, the law firm behind Out-Law, said the introduction of the grid had been widely welcomed.

“The forum’s decision to continue compiling the grid reflects the proven value for regulated firms of its composite view of regulatory developments from the forum’s members. The forum has taken feedback on board and made changes to the format so it is more user-friendly. With the addition of indicating whether the proposed change is likely to be of interest to consumers, and the FRC joining the forum, the new grid is wider in scope and provides a more granular analysis,” Budd said.

The forum said the grid charted a “steady” regulatory course that continued its 'controlled return to normality' approach. It acknowledged there had been a second successive increase in the number of initiatives listed, with the total rising from 111 in September 2020 to 128 in May 2021. This was due to the addition of FRC initiatives; new initiatives in areas where regulators were pushing a shared agenda; and because a number of initiatives had been delayed or paused due to the pandemic.

The forum said its members would continue to monitor the "cumulative impact of regulatory initiatives" on the financial services industry, and consider whether changes were needed.

Budd said it was noticeable that new initiatives on climate and one on diversity in financial services had been added to the multi-sector chapter containing the initiatives relevant to a number of parts of the sector, reflecting the increased focus by both industry and regulators on the environmental, social and governance (ESG) arena.

The grid has been published as downloadable documents and in  interactive dashboard format, enabling users to filter by sector, lead regulator, the expected impact on firms or based on an initiative’s interest to consumers.