This checklist is for compliance, risk, financial crime, surveillance and governance leaders at banks, insurers, pension schemes, hedge funds, asset and wealth managers, e-money and payment firms, and other FCA-regulated businesses trading commodity derivatives -OTC, exchange-traded, or both. If your firm carries positions, hedges exposure, or acts as an intermediary in these markets, IOSCO's direction of travel applies to you.
Understand Your Exposure — whether you have a complete, aggregated view of your commodity derivatives activity — across OTC and exchange-traded positions, desks, entities and jurisdictions — and know exactly where your largest exposures sit.
Data & Transparency — whether your trading data is complete, accurate and timely enough to reconcile OTC against exchange-traded positions and produce regulator-ready reports on demand.
Risk Monitoring and Surveillance — whether your monitoring is forward-looking rather than retrospective, with clear thresholds and triggers for escalating large positions, concentration risk and market impact.
Governance & Accountability — whether ownership of commodity derivatives risk is clear, and whether decisions on large or complex positions are documented, justified and defensible.
Scenario Analysis & Stress Testing — whether you test severe but plausible market scenarios and use the results in real decision-making, not just reporting.
Cross-Border Coordination — whether you have a consistent global view of exposures and can respond to multiple regulators with one coherent position.
Control & Escalation — whether controls over trade capture, position reporting and limit monitoring actually catch issues, and whether escalation for breaches and data gaps is clear and fast.
Technology and Infrastructure — whether your systems give real-time visibility and integration across platforms, or whether you're still relying on manual spreadsheets and fragmented systems.
Regulatory Readiness — whether you can demonstrate full visibility, strong governance and effective monitoring to regulators like the FCA or ESMA, with evidence, not just policies.
Senior Management Oversight — whether senior management receives clear, actionable MI on emerging risk and concentrations, and whether decisions are timely, informed and properly challenged.
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