Disclosure and Financial Market Regulation

Enriques, Luca; Gilotta, Sergio

doi:10.2139/ssrn.2423768

Cited by 22 publications

(3 citation statements)

References 14 publications

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“…The initial obligation to produce a prospectus, which was first harmonized at the EU level in 1985 and initially only targeted undertakings for collective investment in transferable securities UCITS funds [47], evolved with the introduction of the so-called 'Key Investor Information Document' (KIID), a two-page document containing the essential features of the fund [48] (Article 78), and finally extended to a larger range of financial products with the 'Key Investor Document' (KID) [39]. The main objectives of this requirement are protecting unsophisticated investors' trading in the securities market, ensuring the efficiency of the financial markets and reducing agency costs [49], and dealing with the concerns deriving from information overload [50], investors' limited rationality, deviant behavior [51], and non-uniformity among different types of financial products.…”

Section: Disclosure Of Product Informationmentioning

confidence: 99%

Will the EU Commission Successfully Integrate Sustainability Risks and Factors in the Investor Protection Regime? A Research Agenda

Siri

Zhu

2019

Sustainability

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Building a common EU framework for sustainable finance undoubtedly implies the integration of sound and sustainable processes and skills across the whole structure and governance of financial institutions. Consequently, a new financial paradigm is going to be needed, which will require the strengthening of investor care and protection, so contributing to the restoration of trust in the financial sector. In particular, on 18 December 2018, the European Securities and Markets Authority (ESMA) launched two public consultations on draft technical advice for the integration of sustainability risks and factors into the Directive on Markets in Financial Instruments (MiFID), the Alternative Investment Fund Managers Directive (AIFMD), and the Undertakings for Collective Investment in Transferable Securities Directive (UCITS) regimes, with the aim to clarify the so-called fiduciary duties and to increase transparency in the financial services industry. However, the success of the EU initiatives on investor protection regulation may be seriously endangered by the existence of many challenges, weaknesses, and contradictions raised by economists and stakeholders in relation to the definition of sustainability, ESG data availability and reliability, the development of an EU taxonomy, conflicts of interest, product governance, and suitability assessment. This paper starts by briefly analyzing the recent developments of the regulation of sustainable finance at the global level, then offers a more detailed view on the establishment of a common regime on sustainable finance in the EU, with particular reference to the action plan ‘Financing Sustainable Growth’. Then, it examines the recent proposals for regulation on sustainable finance, specifically considering the barriers to the integration of sustainability risks and factors in the EU investor protection regulation—with particular reference to investment services—with respect to its four main dimensions: (1) disclosure of product information, (2) conduct of business (COB) rules, (3) product governance and intervention, and (4) financial education. The paper concludes that the EU reforming proposals, though admirable, risk oversimplifying a complex issue that cannot be easily solved without considering its practical implications on each category of financial operators in the performance of different financial services.

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Section: Disclosure Of Product Informationmentioning

confidence: 99%

Will the EU Commission Successfully Integrate Sustainability Risks and Factors in the Investor Protection Regime? A Research Agenda

Siri

Zhu

2019

Sustainability

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“…(3) ensuring that securities prices reflect available information and thereby fostering efficient allocation of resources across the economy that are most in need of them (Enriques and Gilotta, 2014).…”

Section: Introductionmentioning

confidence: 99%

“…price formation refers to “the speed with which information is incorporated into a firm’s stock price”) (McMullin et al , 2019). Disclosure in financial markets seeks to achieve three core objectives, namely, protection of investors, maintenance of market confidence and preservation of a well-functioning securities market that stimulates economic growth; addressing agency problems; and ensuring that securities prices reflect available information and thereby fostering efficient allocation of resources across the economy that are most in need of them (Enriques and Gilotta, 2014). …”

Section: Introductionmentioning

confidence: 99%

Securities regulation and capital market development in Nigeria: recurring challenges and prospect for solution

Nwatu,

Arum,

Chime

2023

JFC

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Purpose The purpose of this paper, therefore, is to amplify the imperativeness for a re-oriented regulatory approach that prioritizes constructive engagement with the regulated communities, harnessing the existing pool of savings and retention of market participation. Design/methodology/approach The paper adopts a doctrinal legal research design with data drawn from primary and secondary sources of law. The primary sources include case laws and statutes, and the secondary sources include book chapters, journal articles and other internet-sourced materials. Findings The paper finds that the status quo in Nigeria if left to continue would spell severe economic disaster for Nigeria’s securities administration, but a well-structured realignment of the regulations would boost the country’s securities market effectiveness. Research limitations/implications The research’s conclusions and suggestions might only be applicable to Nigeria’s particular situation with regard to capital market development and securities regulation. Other nations or locations with distinct regulatory systems, market structures and economic situations may not be able to immediately adapt it. When extending the research results outside of the Nigerian environment, caution should be exercised. For regulatory agencies and policymakers, the research offers insightful suggestions. The analysis may pinpoint certain areas where policy changes are required to address reoccurring problems and improve the chances for a healthy capital market. Practical implications For Nigeria’s regulatory frameworks controlling securities to be strengthened, this paper would be crucial. To make sure they are in line with global best practices, this entails examining and revising current laws, rules and standards. A stronger regulatory environment may also result from the implementation of harsher enforcement procedures and consequences for noncompliance. It is also required for creating market infrastructure, fostering market integration and cooperation, facilitating access to capital, monitoring and evaluation. It would also benefit investor education and protection. Social implications Addressing these persistent issues and potential remedies in Nigeria’s capital market development and securities regulation would have various advantageous social effects. These include improved market infrastructure, more financial inclusion, improved investment protection for investors and improved market openness and integrity. Such results will help Nigerian society as a whole by fostering economic expansion, job creation, wealth distribution and general social progress. Originality/value This paper is the original work of the authors and has not been published anywhere nor submitted to another journal for publication.

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Legal and Regulatory Considerations Pertaining to Islamic Capital Markets

McMillen

2017

Islamic Capital Markets and Products

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Disclosure and Financial Market Regulation

Cited by 22 publications

References 14 publications

Will the EU Commission Successfully Integrate Sustainability Risks and Factors in the Investor Protection Regime? A Research Agenda

Will the EU Commission Successfully Integrate Sustainability Risks and Factors in the Investor Protection Regime? A Research Agenda

Securities regulation and capital market development in Nigeria: recurring challenges and prospect for solution

Legal and Regulatory Considerations Pertaining to Islamic Capital Markets

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