On Friday I was at the International Organization of Securities Commissions (IOSCO) annual stakeholder meeting in Madrid, which gathered regulators and industry representatives to discuss the key issues and work of IOSCO for 2020. IOSCO is an association that brings together bodies that regulate securities markets across the globe. It plays a crucial role in sharing information between regulators as well as highlighting best practice to help facilitate cross-border market transactions and operations.

A key element of the meeting was setting out the IOSCO priorities for 2020, which you can view here. Five of the priorities are carried over from last year - including looking at market fragmentation; how technological developments are impacting markets incorporating crypto-assets, machine learning and artificial intelligence; and the role of passive investing and index providers on the market. In addition, IOSCO will add corporate debt and leveraged finance to its priority list. The chair of IOSCO, Ashley Alder (CEO, Hong Kong Securities and Future Commission), was keen to highlight that IOSCO's work was focused on helping deliver better investor protection and reducing systemic risk. It was through this lens that IOSCO had agreed on the topics it was looking at during the year.

The event included panels with IOSCO members and industry representatives and there was a real emphasis on the need for regulators to work together, promote deference and to try and develop common expectations so that international markets can operate effectively in an ever- changing landscape. From an industry perspective it was great to hear stakeholders talk about activity based, proportionate and objective regulation. UK Finance advocates for collaborative and effective dialogues between regulators and supervisors that focus on an outcomes-based approach, so it is encouraging to hear regulators recognise the importance of this at an international level.

From a UK Finance perspective, the issues arising from global market fragmentation are key for our capital markets and wholesale members given the international nature of their businesses. IOSCO will seek input to develop a Report on Good Practices in Relation to Deference. With members noting fragmentation of global markets as a key concern, it is encouraging to see an influential global body such as IOSCO coordinating work to highlight best practice in this area, as well as facilitating dialogue between regulators across the globe. Going forward it will be important for UK Finance and its members to demonstrate what the impact on their operating and business models might will be from global market fragmentation. If you would like to be part of this workstream please contact Michael.Jefferson@ukfinance.org.uk.