One Securities Regulator in Canada

Regulation seems to be becoming a current topic on this blog now that I've written a couple of articles on the subject, and I have a couple more in mind that may appear this week. It was therefore serendipitous that this Globe and Mail article by Bill Downe, BMO's CEO, caught my attention this morning.

The message in the article is clear and so does not need any elaboration. It suffices to say that I agree with it.

The one supplementary point I would make is my hope that if we do finally get a single, national securities regulator in this country that it will have teeth. There is a lot of misconduct under the radar in corporate governance in Canadian-listed companies, in which we are hardly unique. The record of the OSC, among other provincial bodies, has been less than stellar in identifying and prosecuting abuse of shareholders' trust. Mostly they wait for the SEC in the US to take action and then cooperate with the US investigation or, later, engage in mimicry with a similar but ineffective action of their own. Try to think of any successful action by the OSC against a corporation or its directors and officers, especially one undertaken on their own initiative.

So, yes, we do need one regulator, but it should also be one that holds public corporations to account. Without that it is no more than an administrative bottleneck for Canadian businesses, as Mr. Downe alludes to in his article.