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Let’s work on standards instead of regulation
The European financial services industry rightly complains about the ever-increasing pace of regulation. The EU Commission reinforces the impression that regulation is being pursued as an end in itself for the continued employment of civil servants and not for the benefit of consumers and companies.
The regulatory appetite of the Commission with its 33,000 civil servants is particularly evident in the rampant practice of supplementing existing directives, such as MiFID II or the IDD, with a large number of black box authorisations that empower the EU Commission to issue Level 2 regulations to an indeterminate extent.
Against this backdrop, the initiative to develop European standards for financial services is met with understandable mistrust. "We already have so many rules, why should we add more on top now?" This is how many people react when I tell them about the establishment of the new Technical Committee 475 Finance at the European Committee for Standardisation CEN.
Yes, we already have many rules, but these are often the wrong ones, which achieve the opposite of what was intended. For example, excessive information requirements have led to sales prospectuses for financial services products being hundreds of pages long, but the retail investor is unable to recognise the essentials. Advisors are supposed to determine the investor's sustainability preference and...
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