As announced in its 2020 Action Plan (see EUROPE 12562/9), the European Commission published, on Wednesday 9 June, a toolkit of indicators that will be used by its services to measure progress on the Capital Markets Union (CMU). The introduction of indicators was also recommended by the European Court of Auditors in a November 2020 report (see EUROPE 12600/36).
“These indicators will help identify whether certain rules need to be adjusted to boost Europe’s capital markets or if new measures are required”, the Commission said in a statement.
In determining these indicators, the Commission took into account three main criteria: - they must be strongly linked to the objectives of the CMU; - be ideally available to all EU Member States; - cover the period since 2015.
The indicators are therefore organised around the three main objectives of the CMU. Thus, to monitor the objective of making finance more accessible to EU businesses, 19 indicators are proposed. The first indicator concerns the evolution of listed shares and corporate bonds in the financing structure of non-financial corporations, the Commission pointing out that these are indeed the two main capital market instruments.
For the second objective, which is to make the EU a safer place for people to save and invest for the long term, eight further indicators are presented. In particular, the Commission considers that measuring whether households use market instruments as a means of saving, either directly or indirectly, by investing through non-bank financial intermediaries, is a good indicator. Indicators on sustainable finance and digital finance were also selected.
Finally, for the third objective, namely the integration of national markets into a genuine single market, the document highlights seven indicators that aim to give an overall picture of reluctance to invest abroad and of the availability of channels for retail investment in other Member States.
While they are intended to complement the Commission’s toolbox, these indicators have their limitations and are not intended to replace the legislative review process, the Commission says.
The Commission plans to update the indicators once a year. See the working document: https://bit.ly/3zdN0g3 (Original version in French by Marion Fontana)