Close Close

Regulation and Compliance > Federal Regulation

Financial Services Execs Stressed Over New Regulations

Your article was successfully shared with the contacts you provided.

Regulatory change is high on the agenda at financial services firms, second only to market volatility as a worry among executives, new research from SunGard has found.

Senior executives now worry that changes starting to take effect this year are distracting attention from core business activities and potentially hindering their firms’ ability to grow.

Adapting to new regulations is also causing leaders to rethink their approach to compliance and to restructure their organizations accordingly.

The SunGard survey, which was conducted by Longitude Research in late 2013, polled 400 senior financial services executives across the globe.

The survey found that the pressure of dealing with regulatory change had expanded beyond compliance departments into the corporate suite.

Fifty percent of respondents warned that dealing with regulatory change had affected shareholder returns and the ability to invest for the future.

Forty-six percent of respondents described themselves as “highly stressed” by the current pressure of regulatory change, and saw little prospect of imminent improvement.

The broad nature of change was driving a more cross-functional response within businesses, according to the survey. Best-in-class institutions were breaking through siloes, allowing for a more efficient response to the issue.

Despite ongoing efforts, readiness levels remain relatively low. Only one in two financial services firms said they were highly ready for the regulatory changes confronting them throughout 2014 and 2015. 

Firms planned to continue investing heavily in technology, people and processes over the next two years to cope with regulatory change, the survey found.

While acknowledging the benefits of a culture change to compliance, 40% of respondents said they found it challenging to move beyond a checking-the-box approach.

However, most firms in the survey said they accepted the need for regulatory change and were moving along with their responses to new regulations — even as they expressed concerns that the degree of change was overblown.

“The definition of what regulators are becoming concerned about is broadening to include areas such as operational risk, adding extra strain to the financial services industry,” Jeffrey Wallis, managing partner and president of SunGard Consulting Services, said in a statement.

“Our survey demonstrates that executives at the highest levels are struggling to marry ensuring regulatory readiness with maintaining a focus on day-to-day operations. In our work with firms on regulatory compliance, we see the most success when a business takes a combined approach to the twin challenges of growth and compliance.”


© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.