Changes in the insurance industry and financial regulation are highlighted in a new publication.

Accountancy firm KPMG has released its latest Horizons publication which covers financial services risk and regulatory insight from across the European, Middle East and African regions.

The latest issue draws out two hot topics that could see the Isle of Man affected, namely the international insurance regulation and the increase in financial services supervisory conduct and activity.

The newly-announced International Association of Insurance Supervisors (IAIS)’s strategy shifts the emphasis from policy standards to supervision of an insurer’s culture.

This is a change in focus, which will influence the approach adopted by insurance supervisors around the world.

The publication explores the potential impacts of this shift and how material it could be for firms.

’Financial services regulation continues its evolution from rules based to conduct based and now to culture based. On the island we would all recognise that regulations for different financial services sectors are at different stages of this evolution - some more rules based and others fast becoming conduct and culture based - the end game is clear,’ said Simon Nicholas, financial services partner at KPMG in the Isle of Man.

The publication Horizons also considers how financial services supervision is becoming stricter.

Reviews of post-crisis regulation and new areas of rule-making remain priorities for policy-makers, but supervision and monitoring activities have moved up the agenda.

’Culture and conduct have really moved up the regulatory agenda in the post-crisis world and getting them right is imperative for any business,’ said Elaine McCormack, senior manager at KPMG Isle of Man.

’Companies should be setting standards for staff to work to, and be able to monitor compliance with these standards so they are able to demonstrate the culture and conduct within their organisation.’

Other topics covered within the publication include ’Sustainable finance: continuing regulatory focus’ looking at the continuing regulatory focus on sustainable finance, ’Resolution - disclosure and operational readiness’ highlighting the new disclosure requirements and implications for large banks and ’EBA finds significant capital shortfalls’ looks at the European Banking Authority (EBA)’s assessment of Basel 4 which reveals significant capital shortfalls for large EU banks.

The publication also explores the increase in financial services supervisory conduct and activity to generate good banking, highlights the Financial Stability Board (FSB) pressures on large banks to enhance their resolvability and also looks at the European Banking Authority (EBA)’s assessment of Basel 4, which reveals significant capital shortfalls for large EU banks.