As 2018 approaches, the Chief Compliance Officer (CCO) of registered firms may find themselves having to submit their annual reports to the Board of Directors. According to Canadian securities law, the report of the CCO is meant to assess compliance by the firm, and individuals acting on its behalf, with securities legislation. CCOs are urged to describe in the report, among other things, instances of non-compliance that may impact clients or the capital markets.
The OSC has provided guidance what could be included in the report of the CCO, for example, any deficiencies identified by the firm, key compliance risks facing the firm, training that the firm undertakes on compliance, how the firm has dealt with recent changes in law, etc. The annual report of the CCO is just one of the tools that assists the CCO in his or her compliance role at the firm.
Of course, the CCO has other specific responsibilities as the compliance captain of the registered firm. The CCO is responsible for monitoring and assessing compliance, reporting to the ultimate designated person instances of non-compliance, and establishing and maintaining policies and procedures, including establishing and testing internal controls, to comply with various regulatory requirements. While compliance systems cannot be ironclad, the CCO has a responsibility to ensure that the compliance systems in place provide reasonable assurance that the firm will meet all requirements of securities laws and manage risks appropriately.
It is important that the CCO, among other things, keeps current of regulatory requirements, have adequate resources to fulfill the forgoing responsibilities appropriately and performs self-assessments of firm’s compliance with securities laws.