Federal finance minister Jim Flaherty called Thursday’s decision by the executive board of the International Monetary Fund to approve significant reform of the fund’s voting structure “an important milestone in the reform of the IMF,” even though IMF governors have not yet approved it.

“I have repeatedly called on the IMF to reform its quota system as a vital element in the ongoing renewal of the institution, and I congratulate the IMF’s managing director, Rodrigo de Rato, on the progress made by the fund to date,” said Flaherty on Friday.

“While much work remains to be done, I look forward to working with my fellow governors at the IMF annual meetings in Singapore later this month to advance the broader IMF reform agenda, so that the fund can continue to play its critical role in ensuring a more flexible, market-based international financial system,” he added.

The first stage of quota reform will involve increases for four countries that are significantly under-represented at the IMF — China, Korea, Mexico and Turkey. The second stage will involve a revision of the formula to determine quotas, an increase in the voice of low-income countries and a series of other governance reforms.

Canada and other nations have called on the IMF to revise its quota system, which is used to determine each member’s voting power and its access to IMF borrowing, to more accurately reflect the relative size of emerging economic powers in the world economy.

Canada is also advocating reform of the Fund’s surveillance function to ensure that IMF members respect their obligations to conduct exchange rate, fiscal, monetary and financial sector policies in a manner consistent with global financial stability.