What’s new with advocacy at CFA Societies Canada?

Advancing investor protection, industry professionalism and market integrity across Canada, CFA Societies Canada focuses attention on pressing advocacy files dominating the regulatory agenda. Ensuring fair, equitable and sustainable outcomes for stakeholders is more important than ever. Through our growing relationships with policymakers and regulators, we are working on several important initiatives. Below is a summary of two areas where we have recently provided comment letters. To see the comprehensive catalogue of our commentary letters, visit us online at cfacanada.org/advocacy.

Ontario Ministry of Finance – CFA Societies Canada co-signs letter with PMAC urging Ontario to join CSA Passport System

CFA Societies Canada and the Portfolio Management Association of Canada (PMAC) have co-signed a letter to Ontario Finance Minister Peter Bethlenfalvy urging the province to join the Canadian Securities Administrators’ (CSA) Passport System. The letter argues that Ontario’s participation would reduce duplicative regulatory reviews, lower compliance costs, improve access to capital across provinces and support a more integrated and competitive Canadian economy.

As the only province not participating in the Passport System, Ontario creates added complexity for firms seeking to operate nationally. The letter notes that joining the system would align with current provincial and federal priorities to reduce interprovincial trade barriers, enhance labour and capital mobility and strengthen productivity and economic growth across Canada.

CSA – Proposed Liquidity Risk Management Amendments to NI-81-102

The letter outlined the CAC’s response to the CSA’s proposed liquidity risk management reforms for investment funds. The CAC supported the overall direction of the consultation, especially the move to formalize liquidity risk rules and broaden the available liquidity management tools, but argued that the proposed governance model places too much responsibility on compliance rather than on an independent risk function. It also urged improvements to liquidity classification, disclosure, regulatory reporting and coordination on broader macroprudential risks.

Key highlights from the CAC’s submission include that the CAC:

• Supported the CSA’s effort to strengthen liquidity risk management rules, but said oversight should have rested with an independent risk function, ideally led by a chief risk officer reporting to the board or senior leadership.
• Supported expanding the liquidity management toolset and making the three existing tools a mandatory minimum baseline, while encouraging broader use of additional price-based and quantity-based tools.
• Accepted the four-category liquidity classification framework only as a baseline, and said it should have incorporated price impact, position size and stressed-market conditions.
• Opposed investor-facing liquidity profile charts in the current form, but supported stronger standardized liquidity management tool disclosure and confidential, technology-enabled regulatory reporting.
• Took the position that the framework should have applied broadly across reporting and non-reporting funds and should have been considered within a wider macroprudential context.

Who is CFA Societies Canada?

CFA Societies Canada represents the 12 Canadian CFA Institute Member Societies and, ultimately, Canadian CFA charterholders. CFA Societies Canada’s Canadian Advocacy Council includes investment professionals from across the country who review regulatory, legislative, and standard-setting developments affecting investors, investment professionals, and Canadian capital markets. CFA Societies Canada through its advocacy efforts strives to advance market integrity, transparency, and investor protection, and actively engages Canada’s securities regulators, self-regulatory organizations, industry associations, legislators, and other stakeholders through thoughtful leadership, direct engagement, and the publication of comment letters.

Have your say

If you would like to participate in advocacy activity related to these letters or future policy and regulatory initiatives, provide comments on ongoing initiatives, or learn more about volunteer opportunities in advocacy, please contact info@cfacanada.org.

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