The financial reporting landscape is set to evolve with the upcoming implementation of CRD6 (Capital Requirements Directive VI) and CRR3 (Capital Requirements Regulation III). These new regulations aim to enhance transparency, improve risk management, and harmonize reporting practices across the EU.
With Diligence Software, prepare for this transition smoothly and stay compliant while improving efficiency.
Summary of Key Updates with CRD6 and CRR3
What’s Changing:
- Increased Reporting Requirements: More detailed and standardized data for better regulatory supervision.
- New Templates for Pillar 3 Disclosures: Greater transparency on risks and capital through standardized reports.
- Alignment with Basel III Reforms: Adoption of the final Basel III standards to align global practices.
- Integration of ESG Risks: A stronger focus on environmental, social, and governance (ESG) risks.
- Stronger Risk Management Rules: Revisions to operational and credit risk calculations.
Key Implications to Note
1. More Detailed and Standardized Reporting
CRD6 and CRR3 introduce updated taxonomies to improve regulatory reporting. This involves:
- Uniform data formats (XBRL becomes essential).
- Increased granularity in information on credit risks, liquidity, and leverage.
- Faster submission cycles, reducing the time available for manual processes.
2. New Templates for Pillar 3 Disclosures
Transparency is at the heart of these new requirements:
- Mandatory publication of data on capital adequacy and risk exposures.
- Inclusion of ESG risks, particularly climate risks.
- Provision of key data to meet stakeholder expectations.
3. Alignment with Basel III
CRD6 and CRR3 finalize the Basel III reforms by integrating:
- Adjusted capital floors.
- Revised calculations for risk-weighted assets.
- New leverage buffers for systemic institutions.
4. Integration of ESG Risks
For the first time, climate risks are directly included in capital requirements, forcing institutions to assess:
- Transition risks (e.g., exposure to fossil fuels).
- Physical risks (e.g., impacts of climate events on assets).
How Diligence Software’s XBRL Suite Simplifies the Transition
The XBRL suite from Diligence Software, including XBRL Express, XBRL Pro, and XBRL Connect, is already updated to meet the new requirements of CRD6 and CRR3.
1. An XBRL Suite Ready for CRD6 and CRR3
- Immediate Updates: The suite is equipped with the latest taxonomies required to meet the new reporting standards.
- Guaranteed Compliance: Our tools generate reports perfectly aligned with the templates required by regulators.
2. End-to-End Automation
- From Data Collection to Submission: Diligence Software automates the entire reporting process, reducing human error and speeding up workflows.
- Direct Connection to Authorities: With XBRL Connect, your reports can be submitted directly to regulators, eliminating friction.
- Deadline Optimization: Meet new deadlines effortlessly.
3. Managing New ESG and Pillar 3 Templates
With our integrated tools:
- Generate disclosure templates compliant with CRD6 and CRR3 requirements.
- Easily aggregate and tag ESG data.
- Meet investor expectations for transparency and sustainability.
What You Need to Do Now
1. Understand the Changes
Review the specific CRD6 and CRR3 guidelines applicable to your reporting obligations, particularly:
- New templates.
- ESG disclosure requirements.
- Submission deadlines.
2. Assess Your Reporting Tools
Ensure your current tools can:
- Handle increased data granularity.
- Generate reports compliant with the XBRL format.
- Adapt quickly to regulatory updates.
3. Collaborate with Diligence Software
Trust Diligence Software to simplify your operations. With our XBRL suite, you can:
• Stay up-to-date with regulatory changes.
• Ensure data accuracy and transparency.
• Reduce your team’s workload.
Prepare now
With CRD6 and CRR3 on the horizon, preparation is essential. Diligence Software provides turnkey solutions to not only ensure compliance but also optimize your processes. Contact us today for a smooth transition to these new regulations.
