Investor advocacy group FAIR Canada is calling on the Ontario government to name an investor-friendly candidate as the next head of the Ontario Securities Commission.

The term of the current chair of the OSC, David Wilson, is due to end in the next couple of months. And, while nothing has been announced about his possible reappointment, it is widely expected that he will leave the commission at the end of his term.

On Friday, FAIR Canada announced that it has written to Ontario Premier Dalton McGuinty and the province’s finance minister, Dwight Duncan, “urging the appointment of a proactive investor-focused OSC chair.”

FAIR says that this appointment is particularly important amid the ongoing effort to create a national securities commission.

“The move to establish a national commission will lead to an overhaul of the securities regulatory system in Canada. Meaningful protection of investors can be set back further without a strong OSC advocating for investor interests in discussions about the structure and legislative framework governing the proposed national commission,” it argues.

The OSC will likely form the largest part of a new national commission, particularly if Alberta and Quebec don’t participate, FAIR notes. And, it says this makes the appointment of a strong chair even more important. “With a dynamic new chair, Ontario can deliver an energized and vital agency with a successful track record of enforcement and investor protection. With a ‘caretaker’ chair, the morale and quality of staff at the agency will likely deteriorate,” it says.

Moreover, it says that investors cannot afford to wait for a strong advocate while the national regulator is being formed and staffed. “Canadian investors need and deserve better investor protection now,” it says.

In the meantime, investor protection in Canada is lagging other major markets that have instituted broad reforms in response to the financial crisis, the group says. “While great progress is being made in many other leading markets, there have been very few meaningful improvements to investor protection in Canada,” FAIR says.

And, it suggests that a strong, investor-focused chair would also help address criticisms of the OSC that were made in a legislative committee report earlier this year.

IE