Asia Pacific Financial Services Regulatory Updates, Quarter Three 2021

The Deloitte Asia Pacific Centre for Regulatory Strategy is pleased to share with you the key regulatory updates from around our region for Q3 2021.

From COVID FIFO to COVID FILO: Eighteen months on from COVID being declared a global pandemic, and the rest of the world is gradually learning to live with COVID-19 as an endemic disease, APAC is getting used to the idea that our initially believed first in / first out status is turning into first in / last out. When we were hoping the strength of our regional response and associated reduction in the need for support measures would lead to greater market prosperity, we are instead finding that regulators continue to need to adjust settings to support industry and individuals.

While the main trends from the immediately prior periods remain prevalent, there are also some subtle shifts appearing, as follows:

Technology and data: As the use of artificial intelligence and machine learning grow in relevance through many components of financial services businesses, and access to and governance of data continues to garner focus, whether it be to enhance performance or to manage and protect that data's integrity, regulatory focus continues to develop across the region. Aligned with this focus is the ongoing development of technology with various stances across the region, from regulators promoting innovation through to the establishment of digital currency and consideration of the environment surrounding crypto assets.

Regulatory supervision: Like many financial services organisations over the challenging COVID period, a number of supervisors have taken the opportunity to challenge their approach to oversight and supervision. The developments include changed approaches to supervision, the establishment of an enforcement division at one regulator, and updated oversight plans that include more intrusive activity.

Climate and sustainability: Consistent with prior periods, climate and sustainability remain highly visible topics, with a number of jurisdictions updating regulations and some providing intent guidance on developing climate related risk assessment rules. There is no doubt sustainability remains at the top of the agenda in the region, with announcements including support for Green Bonds, and the establishment of co-operative groups focused on sustainability initiatives.

Accountability and remuneration: The focus on conduct and culture has not diminished, and this period sees a number of initiatives drawing closer to the purse strings of executives and Boards, as rules and requirements on remuneration are specified. Aligned with these remuneration implications is an ongoing stronger focus on the requirement for specificity of accountability, cascading from the Board down to varying levels within the organisation.

As you read this update, you will see that the volume of regulatory activity is very high. Whilst some is COVID related, there is also much that appears to be leaning towards business as usual. We hope this update is of interest and finds you and your community also moving towards a more positive personal and business outcome.

For queries or more information on these updates or other regulatory topics, please get in touch.