Developing a risk-based approach to monitoring the investments of pension funds is one of the goals the Financial Services Commission of Ontario set for itself Monday.
In its statement of priorities, FSCO says it will test an investment monitoring model in 2005, and aims to fully implement the program by spring 2006.
It will also implement risk-based market conduct assessments for property and casualty insurance companies and life insurance companies. “The assessments will enhance consumer protection and identify ways to improve market efficiency,” FSCO says.
The regulator also plans to develop and implement risk-based examination processes for pension plans, mortgage brokers and insurance companies. “The objective of this initiative is to evaluate the safety and soundness of companies through a separate assessment of inherent risks and risk management processes,” it says. “This approach is a more cost effective use of resources as it works through a sharper focus on risk.”
In addition to enhancing risk-based regulatory approach, FISCO’s priorities are:
- promoting a coordinated national approach to regulatory issues;
- reviewing and recommending amendments to the regulatory framework to keep up with changes in the marketplace; and
- improving delivery of services.
“We believe these strategic priorities and the initiatives associated with them will have a positive impact on consumers and pension plan beneficiaries,” the commission says. “By pursuing them, FSCO will meet the on-going needs of financial services consumers.”
FSCO notes that most of the projects it undertakes involve a range of stakeholders and are carried out in conjunction with federal and other provincial jurisdictions. “As a result, many initiatives span several years and work continues on an on-going basis from year-to-year,”’ it says. The new statement of priorities also includes a report on key initiatives from the previous year’s statement.