President and CEO explains how new branding as Canadian Forum for Financial Markets reflects the organization’s goals and methods
The Gordian Knot is a legend from ancient Greece, of a rope tied to an oxcart so entangled and interwoven that whoever could untie it was promised to rule all of Asia. In the legend, a young Alexander the Great approached the knot, pulled out his sword, and cut through it.
While not as dramatic as the legend, the metaphor of the Gordian Knot can ring true to observers of Canada’s financial services industry. The multiple layers of registration, designation, and provincial regulation can feel challenging to untangle and restrictive to innovation on capital markets. While the simple solution of Alexander’s sword is not a viable option, one advocacy organization is recommitting itself to untangling this industry’s own knots and renaming themselves in the process.
The Investment Industry Association of Canada (IIAC) has announced that as of today it will be called the Canadian Forum for Financial Markets (CFFiM). Laura Paglia, President & CEO of CFFiM, explained that this rebrand stems from what the organization has become over the past several years. She explained that as both the IIAC and now as CFFiM, her organization has established itself as a discerning and dedicated forum for industry advocates.
“During my time with this organization, we have very purposefully taken methodical steps to address hard issues. We've done that with intentional, deep, macro analysis. We have elevated our standards of participation, and our expectations of regulators and government. We did those things with the objective of then changing our name to reflect our proven activity,” Paglia explains. “What that does, frankly, is it positively and productively moves away from the ‘lunch crowd.’ The self-interested resume builders and social circles that impede defensible outcomes fall away.”
Paglia explains that the CFFiM has intentionally shaped itself to work with the busiest executives and experts, asking them for their time with the promise that it will not be wasted. They view value in terms of the effectiveness of their output rather than the number of meetings someone has. They eschew the idea of networking for its own sake. Paglia notes that the word itself can be used “to cover all manner of sins.”
In cultivating a more selective cohort for their forum, Paglia says her organization has sought to welcome divergent points of view and critical thinking. Their goal has been to build a practical think thank that grasps macro issues but offers implementable suggestions and solutions. Under their new banner they have committed to at least five named goals.
- Stimulate capital raising
- Reduce regulatory duplication and fragmentation
- Advance a more competitive tax system
- Strengthen retirement savings frameworks
- Transform financial services delivery
Paglia notes, for example, that the goal of stimulating capital raising is informed by Canada’s significant productivity declines relative to its OECD peers. The CFFiM sees startups and entrepreneurship as key sources of productivity and they believe that by stimulating capital raising, some of the productivity issues can be addressed. Paglia notes the success of the UK’s Enterprise Investment Scheme, where government money is used to support startups, but the decision of who merits investment doesn’t lie with government, which Paglia says can pick winners and losers in other situations like these.
The CFFiM’s second goal of addressing regulatory duplication and fragmentation comes back to that metaphor of the Gordian Knot. Paglia notes that even the term “industry” is extremely amorphous, not to mention key terms like “financial advisor,” which continue to lack firm definitions. She highlights the complex intersecting web of provincial regulators with the CSA as an umbrella. The overlaps between work done by CIRO, the securities regulators, FINTRAC, and OSFI can all make the delivery of financial services more complex and expensive than the CFFiM believes they need to be.
Achieving these goals, Paglia explains, comes back to the model of high standards and professionalism that the CFFiM has set for itself and its participating members.
“The regulator is an arm of government, but we cannot be their arm. We are not their distribution channel,” she says. “We cannot be subject to undue influences from other self-interested forces. We do not run social circles, we run professional forums.”
In proposing solutions and frameworks to regulators and government, Paglia says the CFFiM will insist on clear cost-benefit analyses. They will seek to show, based on clear data and robust research, where simplified solutions can work. Recommendations and communication to government and regulators will be clear and pointed at subjects that many have found uncomfortable to address.
In becoming that professional forum, Paglia says the CFFiM wants to address what has become a bit of a rubber stamp public consultation process. She notes that many initiatives from government or regulators come with relatively short response periods and questions about whether the solicitation of public feedback is cursory or not. She notes several interactions during these consultation periods where regulators or government will say that ‘everyone was onside with this’ during more informal canvassing. She notes the issues that can arise when some consent is given out of fear of retribution or when public consultations are not robust enough. She hopes that her own organization can help make that process more impactful.
“What they will be getting from us is a well researched, well reasoned, thorough response,” Paglia says of her approach. “You are getting a credible, reliable response from us that is real. Not politicized, not preferring one group over another for competitive reasons. Agreeing and saying, ‘great job’ where merited and offering constructive feedback where otherwise merited.”
