Compliance officers (COs) and company executives in Canada’s investment industry shared their opinions with Investment Executive (IE) regarding the regulators that oversee their businesses in our 10th annual Regulators’ Report Card.
This year, IE research journalist Anthony Burton spoke with 108 survey participants from across the investment industry to obtain their ratings for the two national self-regulatory organizations (SROs) and the four largest provincial securities commissions.
Specifically, survey participants who work at firms that are registered with the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers’ Association of Canada (MFDA) rated their respective SRO, and the provincial regulators that they have had direct dealings with in the past two years.
In addition, survey participants at portfolio-management firms, exempt-market dealers and asset-management companies were asked to share their thoughts on the provincial regulators that oversee their businesses.
As in years past, the questions for the Report Card survey were updated to reflect the current regulatory environment and the biggest issues of the day better. For example, in response to the rapid rise of fintech, survey participants were asked to rate “the regulator’s effectiveness in facilitating or supporting industry innovation” for the first time this year. That question is included in the main ratings table found on page 13, and a story on this topic can be found on page 16.
In addition, two supplementary questions were added to this year’s Report Card survey: one to reveal COs’ and company executives’ views on some of the biggest trends emerging in the financial services sector, in which survey participants were asked whether they’re in favour of regulatory action to address the concerns regulators have raised regarding the industry’s use of embedded commissions; and the other to reveal if regulators’ efforts to ensure cybersecurity in the investment industry are adequate. (See stories above and on page 16, respectively.)
Other changes made to this year’s survey involve tweaking the wording of some questions to reflect the regulators’ operations more accurately. In particular, survey participants were asked to rate the “effectiveness of the dealer community’s representation on the regulator’s board of directors and/or special committees” this year instead of “the quality of the dealer community’s representation on a regulator’s board of directors.” (See story on page 19.)
That question was changed in light of the fact that the makeup of a regulator’s board is fairly static and COs and company executives are more likely to participate in committees rather than be on the board of directors.