Canada’s politicians must take up the issue of regulatory reform says TSE and CDNX CEO Barbara Stymiest. In a speech to the Canadian Club of Toronto, today, she proposed that when the premiers meet this summer at their annual summit, they should put the issue of regulatory reform on their agenda.

To facilitate the process, a white paper is being prepared for the Capital Markets Institute and the Canadian Foundation for Investor Education. The report is being written and researched by a Harvard professor Doug Harris and edited by securities lawyer James Baillie.


The paper will capture discussion and the positions of the groups attending a symposium on securities regulation held last week in Toronto. More than 130 Canadian and international representatives from government, industry associations, listed companies, universities and think tanks took part in the symposium. It will be distributed to government officials and regulators and will be available to the public when it is completed later this year.

“No longer a nation of savers, we have become a nation of investors. No longer satisfied with country building, we want to own a piece of what we’re building,” said Stymiest. “And now, directly or indirectly one adult Canadian in two does own a piece of it, and the proportion of Canadians who own shares in Canada will almost certainly rise in the years ahead. In the course of a single generation, the local matter of securities regulation has become an essential part of Canada’s nation-building infrastructure.”

Part of the problem is that securities regulation is fragmented with 13 separate regulators, says Stymiest. “Our provincial regulators are able people who serve their provinces well, with integrity and concern for the future. The problem lies not with the people but with the system within which they operate. By its very nature, it gives predominance to local regulatory concerns over national market needs – and indeed the local concerns of each over the local concerns of others.”

Stymiest conceded that part of the problem is that the present system is maintained by regional politics. “Alberta and B.C. see that kind of national commission as something dredged up from the very shadow of Bay Street. Quebec doesn’t want either one. Each approach is understandable in terms of the imperatives of each province. And that is not unique. Australia had to deal with the same regional tensions. Europe still does.”

She thinks both regional and federal concerns can be addressed. “I don’t question the value of meeting local and regional concerns and accommodating their diversity. We are organizing the TSE and the CDNX to do precisely that. And I don’t think that in addressing our national imperative to compete in global capital markets, we need lose our capacity to address the diverse needs of the different provinces.”

What Canada has, said Stymiest, is not a regulatory problem but a political problem. “And, as a political problem, pretty well everybody agreed that it needs to be solved by political people — by the people we elect to solve problems like this, in other words.