Glossary

The vocabulary of regulatory simulation

A category needs shared words. These are the terms Reglator uses, defined plainly, so institutions, partners and analysts can use them precisely.

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In short

What is regulatory simulation, in one sentence?

Regulatory simulation is the practice of testing what a regulated business decision would do to an institution's regulatory position before the decision is taken — returning consequences, alternative configurations and an explicit statement of where the answer depends on judgement.

The unit of analysis is the decision, not the obligation.
It runs before commitment; RegTech operates after it.
Its output is a comparison of options, not a compliance score.
In the US, consequence is federal plus state, per institution.

Definitions

Terms, defined

Regulatory simulation

Regulatory simulation is the practice of testing what a regulated business decision would do to an institution's regulatory position before the decision is taken.

Regulatory Delta

A Regulatory Delta is the difference between an institution's regulatory position before a decision and its position after that decision.

Regulated business decision

A regulated business decision is a commercial decision whose consequences run partly through regulation — a new product, market, structure, partner or operating-model change.

Design space

A design space is the set of viable configurations that would achieve the same commercial objective, each with its own regulatory consequences.

Continuous regulatory testing

Continuous regulatory testing is the practice of re-testing an institution's regulatory position as its products, volumes, partners, states and environment change.

Institutional context

Institutional context is the description of how an institution actually operates — its products, flows, structure, dependencies and geography — used as an input to simulation.

Regulatory environment

A regulatory environment is one coherent supervisory setting an institution can sit in — in the US, the federal layer plus each individual state.

Regulatory position

An institution's regulatory position is the current state of what it does, which environments it sits in, what its activity depends on, and what must remain true for that to hold.

Simulation record

A simulation record is the durable account of a decision: the options considered, the consequences of each, the assumptions relied on and the reasoning for the choice made.

RegTech

RegTech is software that helps institutions manage, evidence and report the regulatory obligations they already have — after the decision has been taken.

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Where the terms are used

What is regulatory simulation?What is a Regulatory Delta?Decision libraryDiscuss a decision