IIAC stance against best interest standard remains top priority: AGM

The Investment Industry Association of Canada outlined its top priorities for the coming year at its June AGM, including its ongoing stance against a best interest practice

IIAC stance against best interest standard remains top priority: AGM
The Investment Industry Association of Canada has released the output of their AGM, outlining their priorities for the year ahead.

President and CEO Ian Russel identified seven key areas of focus for the association, including its stance against the implementation of a best interest standard. The issue has been a point of contention for several years, as the association argues such measures “will not add substantively to the targeted reforms for investor protection”.

Several provincial commissions continue to push for a standard to be set. Last Thursday, the Ontario Securities Commission stated in its final statement of priorities for the year that it is prepared to move ahead at a provincial level should a consensus not be reached nationally.

Michelle Alexander, vice president of the IIAC, says the association’s stance is that the proposed standard is too vague, and could lead to complications for investors, rather than protection.

“We think there will be some significant negative consequences for investors and the industry including reduced choice among business models, access to financial products, decreased affordability of these products, uncertainty of the obligations and the compliance obligations and the risk of liability for investors,” she says.

“We feel that new initiatives that are being implemented such as client relationship model 2, and some of the targeted regulatory reforms that are proposed in this paper will actually achieve the best outcome for investors.”

The association also announced the election of John Chambers, CEO of Calgary-based FirstEnergy Capital Corp, to the 2016-17 Chair of the IIAC Board of Directors.

“I am honoured to take on the role of IIAC Board Chair at this watershed moment for Canada’s investment industry,” said Mr. Chambers. “Our industry continues to face challenges brought on by sweeping regulatory reform, but under our Board’s leadership, the IIAC will continue to play a constructive role helping regulators and governments ensure rules are properly designed and cost-effective, and avoid unintended consequences.”