In its latest circular, the MFSA highlights the launch of a dry run ad hoc exercise by the European Supervisory Authorities (ESAs) and participating competent authorities such as the MFSA itself. This exercise, to be held over the latter half of 2024, is strategically designed to assist financial entities in familiarizing themselves with the requirements of DORA and to ensure they are well-prepared for its full implementation when it becomes applicable, that is 17 January 2025.
The DORA voluntary dry run exercise aims to provide financial entities with a proactive approach to assess their operational risk management practices. By participating in this exercise, financial entities can:
- gain valuable insights into the potential impact of DORA on their operations;
- test their readiness and capabilities in implementing; and
- identify any gaps or challenges that may require further attention or improvement.
The scope of the DORA voluntary dry run exercise covers various aspects of operational risk management, including data collection, analysis, and reporting. Financial entities participating in this exercise will have the opportunity to assess their data governance practices, data quality, and the effectiveness of their risk assessment methodologies in line with the requirements of DORA.
Participation in the DORA voluntary dry run exercise is not only encouraged but is arguably essential for financial entities to enhance their operational risk management practices. Participating financial entities will receive feedback through their competent authority, including an assessment of their data quality. On the other hand, the exercise is structured to allow financial entities sufficient time to complete the exercise and provide feedback to the ESAs, for them to refine and improve the implementation of DORA based on practical experiences and insights.
By participating in this exercise, entities can assess their data collection practices, enhance their operational resilience, and ensure they are well-prepared for the forthcoming regulatory framework on digital operational resilience in the financial sector.
The dry run exercise, along with all things DORA, will be discussed in the first of three free webinars hosted by the specialised DORA team at Ganado. The webinar will be held on 23 April 2024, with registration via this link.
The ESAs will be hosting a virtual introductory workshop specifically on the dry-run exercise on 30 April 2024, with interested parties invited to register by 25 April through the following link. Furthermore, financial entities are requested to indicate their participation in the dry run exercise by sending an email to the Supervisory ICT Risk and Cybersecurity function at MFSA through roi@mfsa.mt by 3 May 2024.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.