ESMA defines its five-year data strategy
16 June 2023 EU
Image: AdobeStock/Ricochet64
The European Securities and Markets Authority (ESMA) has released its data strategy for 2023-28.
The EU financial markets regulator and supervisor indicates that it will work over this period to facilitate the use of new data-based technologies and to improve data quality and communication of data.
In parallel, it aims to reduce the cost of regulatory reporting for firms in the financial services industry, while improving the use and outcomes of data collected through its data gathering initiatives at EU and jurisdictional level.
ESMA’s five-year plan for 2023-8 was first announced in October 2022 and focuses on three pillars: fostering effective markets and financial stability; strengthening the supervision of EU financial markets; and enhancing the protection of retail investors.
This programme is motivated by two thematic drivers, the need to promote sustainable finance and to facilitate technology innovation and effective application of data.
Over the next five years, ESMA aims to deliver a series of high-level objectives through its position at the heart of European data strategy.
It aims to serve as an enhanced data hub for EU securities markets data, concentrating on improving access to information, interoperability and usability of data while reaping the benefits of economies of scale.
It aims to improve public access to key and relevant data, including retail investor access to information that may affect their investment decisions. This will promote use of machine-readable formats and easy-to-use search engines and analytical interfaces.
The Authority aims to strengthen application of data to support better financial supervision, supported by new and innovative technologies where appropriate. In doing so, it will encourage collaboration between organisations using data in financial services, promotng standardisation, better data quality and reuse of data.
This should also reduce the compliance burden incumbent on reporting entities by removing duplication and inconsistencies in reporting requirements, while encouraging better data sharing.
ESMA conducted an evaluation of its data capabilities at the end of 2021 and drew important conclusions, both positive and negative, that appear now to be shaping its data strategy for the future.
On balance, this assessment concluded that ESMA has developed consistent data reporting standards in areas where it has a key supervisory role and it has processes in place to utilise this data, to create analytical content and to recruit data talent.
However, it also found that ESMA’s current capability is largely at an “opportunistic” maturity level, where its initiatives to exploit data are not systematically coordinated internally and its capacity to analyse, integrate and access data could be more advanced.
“ESMA data governance is also too complex and not clearly defined enough, which strains resources in coordination efforts,” the Authority concludes.
The 2023-28 Data Strategy sets out a number of steps to address these shortcomings, albeit outlined in the document as a series of high-level objectives rather than specific projects defined to a high level of granular detail.
The EU financial markets regulator and supervisor indicates that it will work over this period to facilitate the use of new data-based technologies and to improve data quality and communication of data.
In parallel, it aims to reduce the cost of regulatory reporting for firms in the financial services industry, while improving the use and outcomes of data collected through its data gathering initiatives at EU and jurisdictional level.
ESMA’s five-year plan for 2023-8 was first announced in October 2022 and focuses on three pillars: fostering effective markets and financial stability; strengthening the supervision of EU financial markets; and enhancing the protection of retail investors.
This programme is motivated by two thematic drivers, the need to promote sustainable finance and to facilitate technology innovation and effective application of data.
Over the next five years, ESMA aims to deliver a series of high-level objectives through its position at the heart of European data strategy.
It aims to serve as an enhanced data hub for EU securities markets data, concentrating on improving access to information, interoperability and usability of data while reaping the benefits of economies of scale.
It aims to improve public access to key and relevant data, including retail investor access to information that may affect their investment decisions. This will promote use of machine-readable formats and easy-to-use search engines and analytical interfaces.
The Authority aims to strengthen application of data to support better financial supervision, supported by new and innovative technologies where appropriate. In doing so, it will encourage collaboration between organisations using data in financial services, promotng standardisation, better data quality and reuse of data.
This should also reduce the compliance burden incumbent on reporting entities by removing duplication and inconsistencies in reporting requirements, while encouraging better data sharing.
ESMA conducted an evaluation of its data capabilities at the end of 2021 and drew important conclusions, both positive and negative, that appear now to be shaping its data strategy for the future.
On balance, this assessment concluded that ESMA has developed consistent data reporting standards in areas where it has a key supervisory role and it has processes in place to utilise this data, to create analytical content and to recruit data talent.
However, it also found that ESMA’s current capability is largely at an “opportunistic” maturity level, where its initiatives to exploit data are not systematically coordinated internally and its capacity to analyse, integrate and access data could be more advanced.
“ESMA data governance is also too complex and not clearly defined enough, which strains resources in coordination efforts,” the Authority concludes.
The 2023-28 Data Strategy sets out a number of steps to address these shortcomings, albeit outlined in the document as a series of high-level objectives rather than specific projects defined to a high level of granular detail.
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