One of the most obvious trends dominating the financial markets is the adoption of new and emerging technologies. While it is very obvious in the retail financial sector, where fintechs are increasingly offering digital services, fintechs are also having an impact on the corporate financial sector, including how funds are raised in corporate finance, how the funds are traded and how companies get access to finance. Indeed, the pace of change is causing regulators some headache as they struggle to keep pace with innovation across the sector.
Deloitte’s 2022 M&A Trends survey also puts technology front and centre in driving change. The survey notes that companies are aiming for more transformational change, and many are focused on achieving that transformation through digital upgrades, process simplification and automation.
The same push from regulators to keep pace with technical change is pushing M&A companies to spur more deal activity as they race to beat the implementation of more potentially challenging obstacles.
According to the survey, corporate strategy, M&A strategy and operating model limitations are continuing to intersect in different ways. Deloitte quotes surveyed executives saying that aligning these forces into a coherent approach remains one of their greatest challenges but that there are new tools to help, again including digitally-enabled, virtual and hybrid management of the M&A process.
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Finally, the adoption of artificial intelligence (AI) and machine learning is set to dominate the emerging technology in finance but this is not without its issues as far ranging legislation is currently being debated in the EU and planned to come into law in late 2023. The EU maintains the new legal framework is clear in identifying four different levels of risk: unacceptable risk, high risk, limited risk, and minimal risk, but like its approach to GDPR, this new legislation is both complex and impactful even outside EU borders.