ESMA priorities for 2023-2028

Considering the rapidly changing environment and various challenging factors such as the uncertain economic outlook, potential changes in EU legislation, the need for different energy sources and the reappearance of higher inflation, ESMA has centred its strategy around five key elements that are divided into three priorities and two thematic drivers.

Strategic priorities:

• effective financial markets and financial stability
• supervision and supervisory convergence
• retail investor protection

Thematic drivers:

• sustainable finance
• technological innovation and larger volumes of data

The objective of the 2023-2028 strategy is to continue ESMA’s mission to enhance investor protection, promote orderly financial markets and safeguard financial stability.  

Main elements of ESMA strategy

We have summarised the key takeaways for you below.

Fostering effective markets and financial stability:

In order to make the financial markets more efficient and resilient, ESMA will rely on the following measures:

• implementation of the European Single Access Point (ESAP), which will provide centralised access to all necessary regulatory information
• implementation of the consolidated tapes, which will support more systematic capital allocation and efficient price information
• reduction of the barriers for cross-border transactions
• setting high standards of conduct to address market conduct risk

In order to make a contribution toward strengthening the stability of the financial system, ESMA will focus on:

• upgrading the risk assessments of securities markets
• focusing more on crisis management preparation and planning
• enhancing the resilience of the financial markets infrastructure and addressing interdependencies across market participants
• enhancing the framework applicable to non-bank financial intermediation.

Strengthening supervision of EU financial markets and supervisory convergence:

In collaboration with the National Competent Authorities (NCAs), ESMA will work to strengthen supervision across the EU single market in a proportionate and cost-efficient manner. As part of the strategy, ESMA highlights its ambition to achieve a common EU supervisory culture, risk prioritisation and the convergence of supervisory approaches and outcomes by ensuring a consistent understanding and application of the rulebook. ESMA will also enhance its role as a direct supervisor while focusing on effective coordinated supervision across the EU financial markets.

Enhancing retail investor protection:

To ensure that retail investors are effectively protected, ESMA will concentrate its efforts on risks that arise in connection with new and innovative products or services such as crypto-assets and non-fungible tokens as well as risks stemming from the distribution of complex products as well as alternative marketing and distribution channels (e.g. social media advertising). 

ESMA’s aim is for retail investors to be provided with clear, reliable and understandable information. Further, it will focus on enabling retail investors’ participation in the capital markets and enhancing financial literacy.

Enabling sustainable finance:

ESMA will support the transition to a more sustainable economic and financial system by adopting a holistic view across the sustainable investment chain. ESMA’s goal, therefore, is to increase transparency, work on investors’ confidence in ESG investments and set up supervisory approaches such as sustainable disclosures. 

Facilitating technological innovation and the effective use of data:

ESMA will work together with the NCAs to ensure that the technological innovations affecting the financial markets are covered by robust EU rules. ESMA will therefore focus on assessing the impact of technologies on the existing regulatory framework and implementation of the upcoming EU legislation. The 2023-2028 strategy highlights the following ESMA objectives:

• enhanced use of the available datasets
• development of requirements for FinTech Providers
• monitoring of cybersecurity risks and operational resilience through the supervision of market participants