Smart supervision: sound capacity development approaches for tech-savvy supervisors

Financial authorities' role in maintaining the safety and soundness of firms and the financial sector requires unique expertise and skills. In an ever-changing technological landscape, financial authorities need suitably skilled staff. This allows them to benefit from novel supervisory tools and address emerging risks from financial institutions' use of technology. Building on a survey among financial authorities, this paper provides a framework for technology-related capacity development (CD) to help them adapt to rapid and continuous technological advancements. It outlines strategies for aligning tech-related CD with institutional objectives, fostering an innovation-friendly culture and leveraging structured competency frameworks to identify and address skills gaps. It also discusses multifaceted approaches to CD design and delivery and emphasises the importance of assessing CD effectiveness.