The Ontario Securities Commission (OSC) has released its Statement of Priorities for the fiscal year ending March 2019.

  • While the OSC carried forward most of the priorities from its 2017-2018 Statement of Priorities, a review of the effectiveness of disclosure requirements regarding women on boards and executive officer positions has been added to this year's areas of focus.
  • The priorities listed for the upcoming fiscal year support the OSC's five broad regulatory goals, which are consistent with those identified in past years, namely:
    • Delivering strong investor protection;
    • Delivering effective compliance oversight and pursuing fair, vigorous and timely enforcement;
    • Delivering responsive regulation;
    • Promoting financial stability through effective oversight; and
    • Being an innovative, accountable and efficient organization.

Priorities for 2018-2019

As discussed above, the OSC's priorities for the upcoming year extend many of the priorities outlined last year, including regulatory reforms addressing the best interest standard, addressing embedded commissions, supporting innovation and capital formation through regulatory compliance of FinTech business, and promoting cybersecurity resiliency.

Of note, the OSC states that it intends to review the effectiveness of the disclosure requirements regarding women on boards and in executive officer positions to assess whether further action is necessary. As we've discussed in past posts, the OSC introduced disclosure requirements in 2014 to require transparency regarding board and management composition. While no policies or targets were required of issuers, disclosure requirements were seen as a way of addressing the underrepresentation of women on corporate boards by providing investors with transparency, without imposing quotas on issuers.

As we discussed last year, the Canadian Securities Administrators published a review of board diversity in October 2017, which found that women occupied only 14% of board seats in a sample of issuers, an increase of only 2% over 2016. In light of the review, the OSC states that Canadian regulators will now consult stakeholders as they consider whether changes to the disclosure requirements are necessary, including whether to provide issuers with guidelines regarding corporate governance practices.

According to the OSC, "any action taken in this area is about promoting effective corporate governance and decision-making as diverse boards are better equipped to understand and recognize opportunities."

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