The three European Supervisory Authorities (ESAs) have published a report on their joint criteria on the independence of supervisory authorities.

The ESAs, which consists of the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA).

“Supervisory independence is key to ensure that fair, effective and transparent decisions are taken by appropriately resourced supervisory authorities. These authorities can in turn provide effective and adequate protection for customers and consumers of financial services ensuring confidence in the financial system,” the report stated.

The independence criteria are organised around four key principles: operational independence, personal independence, financial independence and accountability and transparency.

Operational independence ensures supervisory authorities operate without any form of undue influence from the supervised sector and the government, have adequate legal powers and operational resources.

Personal independence guarantees transparent rules for the appointment, selection and removal of members of the supervisory authority’s governing body, and high ethical standards for members of the supervisory authority’s staff and governing body.

Financial independence provides that supervisory authorities have sufficient financial resources to fulfil their mandates. Finally, accountability and transparency is needed so supervisory authorities can conduct their tasks in a transparent and accountable manner.

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