On October 11, 2018, the U.S. Securities and Exchange Commission (SEC) released the final version of its four-year Strategic Plan in respect of fiscal years 2018 to 2022.
The Strategic Plan focuses on three main areas in particular – investors, innovation, and performance.
Some of the highlights of the Strategic Plan are as follows:
- Goal One: Focus on the long-term interests of our Main Street investors. According to the SEC, there is a growing need to ensure that the long-term interests of investors are protected, especially given how many individuals now look to invest as a way to help fund future life events, such as retirement. As part of this effort, the SEC has outlined numerous initiatives, including gaining a better understanding of how different investors interact with capital markets, increasing efforts to combat misconduct, and modernizing EDGAR.
- Goal Two: Recognize significant developments and trends in our evolving capital markets and adjust our efforts to ensure we are allocating our resources effectively. The SEC also recognizes the growing importance of technology and data analytics within securities markets, which has brought with it its own set of risks and challenges from a regulatory and oversight perspective. Consequently, the SEC intends to identify and attempt to rectify any existing SEC rules that are considered outdated, manage cybersecurity risks, and monitor and adapt to the market, among other measures.
- Goal Three: Elevate the SEC’s performance by enhancing our analytical capabilities and human capital development. The final goal within the SEC’s Strategic Plan is two-pronged. Firstly, the SEC aims to improve its hiring program in the hope of hiring, training and keeping top talent. At the same time, the SEC will further develop its use of data, data analytics, and technology more broadly to help with risk and data management.
The SEC initially released a draft version of its Strategic Plan in June 2018, although it appears the final version of the Plan remains widely unchanged.
This is good news for the organizations that approved of the SEC’s emphasis on the importance of items such as data analytics, as those measures still remain in the final version of the Plan. However, there have been calls for the SEC to take matters further when it comes to regulatory compliance and SEC reporting.
XBRL US, for example, sent its comments to the SEC in July 2018 in respect of the draft Strategic Plan. In their press release, XBRL US recommended that the SEC “Require all financial data submitted by all reporting entities, to be provided in computer-readable, standardized format.” Other recommendations included that the SEC use consistent standards across the SEC, such as the XBRL standard, opt to use just one financial data standard, and make greater use of standardized data.
You can read the press release from the SEC here, and the final version of the Strategic Plan in full here.
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