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Opening Remarks to the Standing Committee on Government Agencies
Howard Wetston, Q.C.
Appointment Review
Legislative Building, Queen’s Park, Toronto
November 2, 2010
Good morning.
I am honoured to be nominated as the next Chair of the Ontario Securities Commission.
I have served in the public interest for almost 30 years including as a Crown attorney, a consumer advocate, as head of the Competition Bureau, a Federal Court Judge, a Vice-Chair of the OSC and, for the last seven years, as Chair of the Ontario Energy Board. It has been my honour to serve the people of Ontario and Canada.
Members of the Committee, it is a critical time for securities regulation, here in Canada, and around the world.
In the wake of the recent global market crisis, regulators are examining what we could have done better – in particular, how we could have better protected investors.
The financial crisis highlighted regulatory deficiencies that cannot be addressed at the provincial, or even the national level. Securities regulators around the world, including the OSC, are contributing to the international response to those challenges.
The evolution of the capital markets also reinforces that now – more than ever – we must reform our system of regulation by supporting the implementation of a national securities regulator. I am committed to supporting the Ontario Government, the Canadian Securities Transition Office and participating provincial regulators to make this important goal a reality. And given the size of Ontario’s capital markets, Toronto should be prominent within a national regulatory structure since Toronto is Canada’s financial capital.
During the transition to a national regulator, I shall act in the best interests of the OSC and its staff primarily because they offer excellent expertise and one of my goals would be to transfer that expertise to the national regulator.
Although the market context is changing, the OSC’s overriding objective, derived from its statute and judicial confirmation, is to ensure that Ontario’s capital markets are fair and efficient and that Ontario’s investors are protected.
The OSC must continue to be proactive in pursuing regulatory standards that discourage regulatory arbitrage, maintain market confidence, reduce financial crime and safeguard investors.
As a result of my ongoing observations of securities regulation, and if you concur with this intended appointment, I will be focusing on the following three priorities.
Number 1 − Strengthen Enforcement.
The OSC’s compliance and enforcement regime is vigorous and active. But it must be more visible and better understood by market participants and the public in order to have the desired deterrence effect. We must, where possible, streamline the process. I recognize there will be challenges, but we must responsibly bring enforcement cases along faster. Capital and investment will flow to jurisdictions that have a high level of protection.
Number 2 − Investor Protection.
Investor protection is central to the OSC’s mandate. The interests of investors must be at the core of everything that we do and we must err on the side of protecting investors. This will be even more critical during these transformational times, when investors have even greater concerns for protection. We also need input from investors. I am pleased that the OSC has created the Investor Advisory Panel. The Panel will give feedback on important regulatory initiatives.
My third priority − Proactive rule making.
We need regulatory responses that are “risk oriented” in order to restore confidence in the markets. Market quality is important and investor confidence is crucial. We must get ahead of the curve and anticipate the risks that may threaten in the future.
The OSC must help level the playing field between the investor and the market participant.
We will continue to work with our provincial colleagues, self-regulatory organizations and international regulators to ensure that our regime remains consistent with global standards.
Members of the Committee, in closing, I mentioned that I have a blend of regulatory, adjudicative and enforcement experience. I intend to apply that experience to the best of my ability in meeting the challenges that face securities regulation.
Thank you.
I would now be pleased to answer your questions.
