Compliance officers (COs) and company executives in Canada’s investment industry shared their views about the regulators that oversee their businesses once again for Investment Executive’s (IE) annual Regulators’ Report Card.
For the 2017 edition of the Report Card, IE research journalist Charles Bossy spoke with 125 COs and company executives regulated by the self-regulatory organizations (SROs) and/or the provincial securities commissions.
Similar to last year’s Report Card, survey participants were asked to rate their respective regulators in 17 categories. In some cases, however, the wording of those categories was changed to clarify what participants are being asked to rate.
For example, in 2016, survey participants were asked to rate “the regulator’s fairness when performing audits and examinations of registrants”; this year, COs and executives rated the regulators’ “flexibility” when performing audits.
Similarly, COs and executives were asked to rate “the value received for the regulator’s fees for registrants” rather than the “fairness of the regulator’s fee structure for registrants.”
Finally, survey participants were asked to rate “the quality of the dealer community’s representation on the regulator’s board of directors” rather than rating the overall representation on the board. This change was made in light of the fact that the number of members from the industry who can serve on a board is fixed.
Survey participants from securities and mutual fund dealers were asked to rate their respective SROs as well as their overseeing provincial regulators – as long as they had direct dealings with their provincial regulators within the past two years.
Meanwhile, survey participants who hold similar positions with exempt-market dealers, investment-counselling firms, portfolio-management firms and asset-management companies rated only their provincial regulators.
To generate the ratings in the main table, survey participants were asked to rate their respective regulator(s) in each category on a scale of zero to 10, with zero meaning “very poor” and 10 meaning “excellent.”
A green number on the table indicates that a rating has increased half a point or more compared with 2016. In contrast, a red number indicates that a rating has decreased by that same margin year-over-year.
This year’s survey also included two supplementary questions. Survey participants were asked if they are in favour of the Canadian Securities Administrators’ (CSA) proposal to introduce a “best interest standard”, as well as if their firms are encouraging advisors to drop small accounts from their books of business.
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