More than eight in ten (83%) compliance professionals working in Ireland's financial services sector believe a stronger EU Capital Markets Union (CMU) would create significant growth opportunities for the sector.
This is according to a new survey by Ireland's professional body for compliance professionals, the Compliance Institute, which polled 123 senior compliance experts working primarily in Irish financial services organisations nationwide, exploring their views on a stronger EU Capital Markets Union (CMU) and its potential impact on growth opportunities for the sector.
Almost a third (31%) of respondents said a stronger CMU would “significantly” improve growth opportunities, while a further 52% believe it would do so “somewhat”. Just 9% said it would have no significant impact, 1% said no, and 7% believe it would actually lessen growth opportunities for the sector (see Appendix).
The findings of the Compliance Institute survey come in the wake of a call made last week by Central Bank of Ireland Governor Gabriel Makhlouf for Europe to move faster to complete the single market[1].
Commenting on the findings, Michael Kavanagh, CEO of the Compliance Institute,
“Our survey shows overwhelming support among Irish compliance professionals for a stronger EU Capital Markets Union, with the vast majority believing it would be a positive development for the financial services sector here.
A more integrated EU capital market could make it significantly easier for Irish firms to access funding, scale across borders and compete internationally. This mirrors what we saw in our members' response to the proposed EU 28th regime, where there was similarly strong support for initiatives that reduce fragmentation and make it easier for Irish businesses to grow across the EU.
Reducing regulatory divergence is really the core issue for financial services organisations in Ireland. Ireland hosts a significant share of the global compliance functions for major multinational financial institutions, so any fragmentation - whether that's the gap between EU and US rules since the change in US administration, or different interpretations of the same EU rules from one member state to the next - creates real complexity and cost for the teams within these organisations. A stronger capital markets union could go some way to resolving these emerging issues.
Taken together, these findings point to a clear appetite within the sector for deeper EU market integration, provided it is designed and implemented carefully.”
The Compliance Institute say the finding echoes a similar trend identified in another survey they undertook during the year, which found that 90% of compliance professionals believe the proposed EU '28th regime' - a planned single EU-wide legal framework - would improve growth and expansion opportunities for Irish firms. The compliance experts say the research drives home the message that in the main, compliance professionals in Ireland’s financial services organisations are broadly supportive of EU-level reforms aimed at reducing fragmentation and making it easier for Irish businesses to access capital and scale across European markets.
