Dec 4, 2023

EY’s 2024 Strategic Guidance for Financial Firms Focusing on Compliance, Digital Transformation, and Operational Resilience

EY has published it’s annual 2024 Global financial services regulatory outlook report highlighting the challenges and unprecedented opportunities for firms ready to adapt and excel in this dynamic environment.

As we approach 2024, markets are increasingly shaped by complex regulations, digital innovation, and a heightened focus on sustainability and consumer protection.

Report Overview

• Stay abreast of prudential developments, resolution, and recovery processes. Given the dynamic market conditions, it’s crucial to be well-prepared for regulatory changes and heightened supervisory focus.
• Take a holistic approach to address a range of critical areas including consumer impact, environmental, social, and governance (ESG) factors, digital assets, the digitalization of finance, artificial intelligence (AI) integration, financial crime, and operational resilience. This comprehensive approach is key to staying competitive and compliant.

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• Proactively develop a strategy for ongoing engagement with regulatory bodies, especially regarding new prudential developments. Understanding and anticipating regulatory shifts can position your firm for more effective compliance and strategic planning.
• Strengthen your firm’s capabilities in crisis management, ensuring that capital and liquidity standards are met. This will not only comply with regulatory requirements but also build trust with stakeholders.
• As digital transformation accelerates, establish strong governance frameworks to manage risks associated with digitalization and AI. This will maximize the benefits of these technologies while minimizing potential risks.
• Recognize the growing importance of digital assets and develop strategies that account for varying maturity levels and regulatory landscapes across jurisdictions.
• Integrate ESG factors into your business strategy, governance, and risk management. This includes setting clear targets and supporting sustainability disclosures, which are increasingly important to investors and regulators.
• Adapt to regulatory shifts that emphasize consumer protection in product offerings, pricing, and overall impact. This involves understanding the implications of new products and services and exploring alternative marketing channels.

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• Utilize technology to combat financial crime and fraud. It’s vital to have robust systems for monitoring, detection, and compliance.
• Learn from recent bank failures and other financial crises to strengthen your firm’s risk oversight and resilience governance. Operational resilience should be viewed as a strategic imperative, not just a compliance requirement.
• The economic outlook and regulatory environment are both uncertain and complex. Companies and investors need to stay informed about regulatory changes and adapt their business models accordingly. This involves a firm-wide commitment to setting priorities and tailoring business models to focus on people, processes, data, and technology.

EY’s 2024 outlook presents a comprehensive roadmap for financial institutions, emphasizing the need for proactive regulatory engagement, digital agility, and robust operational frameworks.

Download the 28 page PDF report –> here

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