What Is the Financial Institutions and Prudential Policy (FIPP) Unit?

The term Financial Institutions and Prudential Policy (FIPP) Unit refers to a division within the Centre for European Policy Studies. The think tank, which was founded in 1983 and is located in Brussels, provides European policymakers with research, insight, and solutions.

The FIPP unit mainly conducts research by looking into four areas of financial concern. Individual divisions within the unit are made up of their own task forces that allow the FIPP to work both efficiently and effectively.

Key Takeaways

  • The Financial Institutions and Prudential Policy Unit is a division within the Centre for European Policy Studies.
  • The CEPS is an independent think tank that conducts research and provides European Union leaders with insight and policy solutions.
  • The FIPP Unit researches issues that have to do with the financial services sector, internal markets, and the positioning of financial centers.
  • Individual divisions within the unit have their own task forces and are supervised by an independent board of directors.
  • The unit published its reports and project findings on the CEPS website.

Understanding the Financial Institutions and Prudential Policy (FIPP) Unit

The Center for European Policy Studies was created in 1983 in Brussels. It is an independent think tank that is partnered with different global institutes. The organization conducts research, providing policymakers with insight and solutions in a variety of fields, including the economy, financial industry, markets, and trade, energy, and climate-related issues, education, foreign policy, and legal issues.

The Financial Institutions and Prudential Policy Unit is one of the divisions of the CEPS and is an integral aspect of the crisis management program of the European Union (EU). This unit is responsible for conducting research in the following areas:

  • Regulation and the supervision of financial institutions and financial stability
  • Investigating size, diversity, and innovation in the European financial sector
  • Internal markets for financial services
  • Positioning of small, regional, and international financial centers

As mentioned above, the individual research divisions within the unit have their own internal task forces. This enables the FIPP to work at its most efficient and effective with minimal supervision needed from the CEPS.

Because the CEPS believes in remaining independent, it does not take any institutional positions on any of the issues it researches. Research is conducted without any bias or outside influence and is supervised by an independent board of directors. As such, the organization is committed to:

  • Achieve high standards of academic excellence and maintain unqualified independence and impartiality
  • Provide a forum for discussion among all stakeholders in the European policy process
  • Build collaborative networks of researchers, policymakers, and other stakeholders across Europe

Funding for the Center for European Policy Studies comes from stakeholders, institutions, corporations, and individuals.

Special Considerations

The center comments on a variety of topics related to the economy and financial markets that are available for download from the CEPS website. For instance, the organization completed research on how the introduction of socially responsible investing (SRI) impacted almost a million employees in France's workforce. According to the research, which was published in March 2021, investors boosted their equity allocation by 7%, pointing to increased interest in the equity market.

Another report, published in January 2021, focuses on anti-money laundering (AML) in the EU. The organization found that roughly 2% to 5% of the world's gross domestic product (GDP) is laundered, out of which about 1% is ever only recovered. The report outlined some of the key solutions to fighting money laundering, including tracking systems, stricter enforcement, and the facilitation of cross-border data sharing.

The division also has a series of ongoing projects that it undertakes. The Recovery and Resilience Reflection Group runs between Dec. 1, 2020, and July 31, 2021.

The project involves six staff members and is backed by governments, academics, and institutions from the EU. It focuses on "EU recovery and resilience facility’s implementation, through the relevant regulations, guidance, national plans, monitoring systems."