Unlike most countries, Canada’s securities industry is provincially and territorially regulated – not federally regulated. This means that instead of having one national regulator governed by one Securities Act, there are 13 regulators governed by 13 Securities Acts. This might have made sense many years ago, before the steam engine, but in an age of information there are no benefits for maintaining such a fragmented system.
Having 13 securities regulatory authorities is not only archaic and extremely inefficient, but it actually conflicts with their common mandate of protecting investors.
Take financial literacy, for example. Many Canadians feel there is a lack of financial literacy resources available to them. And yet, all 13 regulators offer their own version of a financial literacy resource. Imagine how much better a financial resource would be if they all collaborated together, pooling their resources and created one definitive financial literacy resource instead.
To be clear, Canada does not lack financial literacy resources. There are a lot of available resources. So many, in fact, that a Canadian Financial Literacy Database was created, which currently lists 1,362 available resources for Canadians. And there is the Financial Consumer Agency of Canada (FCAC), which is the closest we have to a national financial literacy resource. So why then do we have so many competing resources? If the goal is to protect investors, the better option is for all Canadian securities regulators to work together and maintain one definitive financial literacy resource for all Canadians.
Discussions to create a national securities regulator have been going on for years decades. We may not see a national regulator in our lifetime, but that does not mean they cannot work together to create a unified approach to financial literacy. It not only supports their mandate to protect investors, it is also the right thing to do.
Having 13 financial literacy resource from each of Canada’s securities regulators is not nearly as good for investors as having one resource supported by all 13 regulators. This is how we can make meaningful change for Canadian investors, even if we cannot agree on modernizing the securities industry.
John Waldron MBA (FS) Class of 2008
Founder of Learnedly and purveyor of accessible education for financial professionals
John is a repeat contributor on CEGE Connection. We invite you to read John’s posts on CEGE Connection.