Åke Freij

This study examines how regulatory ‘waves’—clusters of interrelated legal requirements—reshape technology usage and value creation in financial services. Drawing on content analyses (topic modeling) of 44 major European regulations complemented with 45 interviews with expert from the industry, we highlight the interplay of regulatory complexity, data capabilities, and technology strategy. Regulatory waves impose overlapping compliance demands, intensifying coordination challenges within firms and across external collaborations. In response, organizations pursue proactive or reactive adaptation strategies, each with distinct risks and opportunities. Our analysis shows that regulatory waves elevate data from a technical resource to a strategic asset, enabling new business synergies but requiring major operational and architectural changes. Firms struggle with source fragmentation and interpretation complexity, facing new risks in data management and system integration. By exposing how regulatory waves influence internal governance, external partnerships, and data-driven value propositions, this study advances theories on policy diffusion, information systems, and strategic adaptation. It offers guidance for managers and policymakers navigating complex regulatory landscapes and leveraging data as both a compliance enabler and a source of competitive advantage.

Technology promises to offer significant benefits in operating a business. At the same time, firms have major challenges in dealing with regulatory requirements. Despite this, studies of technological capabilities offer little insight into the functionality available for supporting regulatory compliance requirements. With both compliance demands and technological complexity evolving at record speed, this is an area demanding increased understanding. This paper analyses data from 107 regulatory technology solution providers for the anti-money laundry compliance field. Conclusions from the study point to a strong availability of basic capabilities for managing products, understanding end markets, and tracking linkages between actors. There is weaker support for capabilities in basic operations. Also, advanced support is less frequent, and the ability to innovate is close to non-existent. The conclusions offer tangible recommendations to practitioners and policymakers concerning the potential benefits and pitfalls of applying technology for regulatory compliance.