On May 26, 2016, the Investment Industry Regulatory Organization of Canada (IIROC) published IIROC Notice 16-0109 IIROC’s Three-Year Strategic Plan and IIROC Notice 16-0110 IIROC 2017 Priorities, which respectively set out the organization’s 3-year strategic plan and its immediate priorities for 2016-17.
Over the longer term, the 3-year strategic plan responds to the expectations of key IIROC stakeholders – including its members, other regulators, investors and employees. At the same time, the plan addresses a number of key trends, including (among others) the aging investor population, a shift among retail investors away from ownership of individual securities (and toward ETFs and other pooled products) as well as technological change that is affecting both the business models of IIROC members and the types of expertise that IIROC requires to be an effective regulator. Also emphasized in the plan is a trend toward improved co-ordination among IIROC and other regulators.
As described in the plan, IIROC’s specific goals for the next 3-year period include:
- Expanding trading conduct compliance reviews to all trading activity of all dealer members;
- Real-time and post-trade surveillance of cross-product, cross-asset and cross-dealer activity;
- Achieving the legal authority to improve its fine collection record;
- Expanding the statutory immunities of IIROC and IIROC personnel;
- Developing a broader range of disciplinary tools to ensure a fair and proportionate response to wrongdoing;
- More effective consultation and proactive education on rules and compliance standards;
- Opening up IIROC’s Market Trade Reporting System (MTRS) data on corporate debt trading to the general public;
- Reducing regulatory arbitrage opportunities;
- Requiring dealers to disclose that they are IIROC members and to hand out IIROC brochures, link to IIROC dealer directories and disciplinary records, etc.; and
- Improving IIROC’s technology in order to keep up with regulatory changes as they occur.
The above are only some of the highlights: additional information on these and other IIROC strategic proposals may be found in Notice 16-0109.
The second notice, concerning IIROC’s immediate priorities for the current fiscal year (ending March 2017), refers to about 40 initiatives, from roundtable discussions with small-cap issuers about market structure issues to surveying dealers on cybersecurity preparedness to issuing special guidance aimed at seniors and completing a technology proof of concept for a “shareable trade data repository for our regulatory partners”. These priorities are set out in Notice 16-0110, together with target dates.
Consistently with IIROC’s strategy of “communicating concisely and in plain language”, these two short and easy-to-read documents offer IIROC stakeholders many valuable insights into how the organization sees its mandate unfolding over the near and medium terms.