Breaking news

ECB’s Consultation On Internal Governance: A Strategic Shift In Banking Regulation

by THEFUTURE.TEAM

July 25, 2024

The European Central Bank (ECB) has launched a public consultation on a new internal governance and risk culture framework for banks, reflecting the institution’s supervisory priorities under the Single Supervisory Mechanism (SSM). This initiative underscores the ECB’s commitment to ensuring robust management practices within European banks, aiming to mitigate the systemic risks highlighted by the global financial crisis and subsequent bank failures.

Enhanced Governance Standards

The proposed framework replaces the 2016 SSM supervisory statement, providing a comprehensive roadmap for banks to establish more effective internal governance structures and risk cultures. It delineates supervisory expectations regarding the composition and function of banks’ management bodies and committees, the roles and responsibilities of internal control functions, and the significance of a strong risk culture.

Follow THE FUTURE on LinkedIn, Facebook, Instagram, X and Telegram

This update incorporates the latest standards from the European Banking Authority (EBA) and showcases best practices identified by the ECB over the years. By setting clear guidelines, the ECB aims to standardise governance practices across the banking sector, fostering stability and resilience.

Addressing Governance Shortcomings

Historical shortcomings in governance and risk culture have often led to significant difficulties for banks, as evidenced during financial crises. Poor decision-making processes can result in imbalances between risk-taking and risk control, posing capital risks and undermining banks’ operational resilience. The ECB’s new guide seeks to address these issues by promoting balanced and well-informed decision-making frameworks within banks.

Ongoing Monitoring and Enforcement

Despite notable progress, the ECB stresses that banks must continue enhancing their governance standards. The central bank will intensify its supervisory scrutiny and employ all available tools to ensure compliance with the new guidelines. This proactive stance is crucial for preempting potential governance failures and maintaining the stability of the European banking sector.

Public Consultation and Stakeholder Engagement

The consultation period, which concludes on 16 October 2024, invites feedback from various stakeholders, including experts from supervised institutions. A stakeholder meeting scheduled for 26 September 2024 will facilitate direct dialogue between the ECB and banking professionals, ensuring the final framework reflects a comprehensive understanding of industry perspectives.

The Future Forbes Realty Global Properties

Only 1% Of Cyprus Farms Use Precision Farming Technologies

Cyprus remains one of the European Union’s least digitised agricultural economies, with just 1% of farms using precision farming technologies in 2023, according to Eurostat.

The findings come as the EU continues to encourage the adoption of digital tools aimed at improving agricultural productivity, efficiency and sustainability.

Follow THE FUTURE on LinkedIn, Facebook, Instagram, X and Telegram

Internet Access Expands, But Digital Uptake Lags

Internet access has improved across the bloc, although adoption remains uneven. Eurostat found that 43% of EU farms had internet access in 2023, with northern and central European countries leading the way.

Denmark, Germany, Slovakia, Latvia, the Czech Republic and Austria all reported internet access rates above 90%.

Greater connectivity, however, has not translated into widespread digital adoption. Farm management information systems, which help farmers manage day-to-day operations, were used by only about 11% of EU farms. France was a notable exception, with around 60% of farms using the technology.

Precision Farming Concentrated In Larger Operations

Robotics adoption also remained relatively limited, with only about 7% of EU farms using robotic technologies. Overall, around 18% of farms with utilised agricultural area employed at least one precision farming technology or practice in 2023.

These included robotics for plant protection, band spraying, variable-rate application, precision crop monitoring and soil analysis. Despite representing fewer than one in five farms, these holdings accounted for around 44% of the EU’s utilised agricultural area.

The figures suggest that precision farming remains concentrated among larger agricultural businesses, where investment in digital technologies is typically easier to support.

Cyprus Lags Behind EU Leaders

Luxembourg, Finland and Estonia recorded the highest shares of utilised agricultural area managed by farms using precision farming technologies, each exceeding 75%.

At the other end of the ranking, Cyprus recorded just 1%, while Greece and Romania reported between 10% and 15%. The results indicate that Cyprus remains at an early stage of digital adoption in agriculture, even as precision farming becomes more widespread across parts of the European Union.