Investment industry association makes submission to banking and investment ombudsman

The Ombudsman for Banking Services and Investments (OBSI), currently undertaking a governance review, is being encouraged to better reflect the investment industry and stakeholders impacted by the ombudsman’s services in its board of directors. Specifically, the Investment Funds Institute of Canada (IFIC) submission to the OBSI governance review recommends that two additional industry directors be added to OBSI’s board to include more comprehensive industry expertise.

The group also encourages the ombudsman to update its board skills matrix to ensure that directors more effectively reflect and represent the needs and perspectives of affected stakeholders.

IFIC recommends OBSI continue to have board members nominated by the New SRO (the New Self-Regulatory Organization of Canada) and by the Canadian Bankers Association (CBA). “IFIC recommends OBSI solicit nominations from industry participants of the currently underrepresented categories of securities registrants for two additional industry director positions,” they write, adding that the majority of the board’s directors should continue to represent the community.

They continue saying since 2014 the ombudsman’s mandate has expanded to include all categories of securities registrants. “However, these other categories of securities registration are not reflected under the current industry directors nomination process,” they write.

“IFIC’s view is that OBSI’s board and committee governance needs to be a fair representation from all stakeholders in the investment industry. With only three industry directors representative of the Mutual Fund Dealers Association of Canada (MFDA now the New SRO), the Investment Industry Regulatory Organization of Canada, (IIROC also now the New SRO), and CBA member firms, we think there is a gap in providing adequate representation of the wide and diverse range of business models of firms in the investment sector.” 

IFIC also suggests that OBSI reconsider the existence of the ombudsman’s consumer and investor advisory council. “IFIC’s view is that the council should not be necessary if OBSI updates it board skills matrix to specifically include experience in a range of consumer and investor perspectives and additional diversity metrics as recommended in the 2021 review,” they write.