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The Future of Credit Rating Agencies: Regulation and Accountability
Thursday June 25, 2009
Session Summary:
Credit rating agencies have served investors for over 90 years providing an independent view of issuers’ credit riskiness. Recently they have come under scrutiny for their failure to identify subprime risks that contributed to the current credit crisis.
Consequently, recent developments in credit ratings agency regulation are not unexpected. In April 2009, the European Union (EU) approved a stringent set of regulations for credit rating agencies. In the US, the Securities and Exchange Commission (SEC) has conducted studies and roundtables to examine credit rating reform.
Professor Stephane Rousseau presented his latest research paper on this topic. He was followed by a panel of distinguished experts.
The ultimate goal of credit rating reform is to provide investors with objective and transparent information on which to base their investment decisions. The question is what model and/or reforms will be most effective?
Panelists Included:
Dr. Marlene Puffer, Managing Director, Twist Financial Corp.
F. Edward (Ted) Price, Assistant Superintendant, Supervision Sector, OSFI
Sean Rogister, President, STR Capital
Alan White, Professor, Finance, Peter L. Mitchelson / SIT Foundation Chair in Investment Strategy, Rotman School of Management
Click here for full agenda and panelist biographies.
Click here for Professor Rousseau's Powerpoint Slides
Click here for Professor Rousseau's Final Paper
Click here for the video of the session.
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Expert Panel – A New Approach to Financial Regulation – Steps to Implementation
Wednesday May 20th, 2009
Session Summary:
On January 12, 2009, the Expert Panel on Securities Regulation, delivered its final report along with a draft Securities Act to the Federal Minister of Finance. This report was the culmination of a 10-month work effort to provide independent advice and recommendations on how to improve the structure, content, and enforcement of securities regulation in Canada.
CMI coordinated the research efforts that formed the basis for the final report
This thought provoking session presented the research papers and lively panel reaction and discussion about implementation issues and timing.
Session Details:
Panel #1
Stéphane Rousseau
Associate Professor, Chair in Business Law and International Trade,
Université de Montréal's Faculty of Law
The Québec Experience with an Independent Administrative Tribunal Specialized in Securities
Distinguished Panelists Included:
Poonam Puri, Associate Professor, Osgoode Hall Law School, York University
Robert Brush, Partner, Crawley, Meredith, Brush LLP
Philip Anisman, Barrister and Solicitor
Panel #2
Cristie Ford
Assistant Professor and Co-DirectorNational Centre for Business Law
University of British Columbia
Principles Based Regulation
Distinguished Panelists Included:
Anita Anand, Associate Professor & Associate Dean, University of Toronto
Carol Hansell, Senior Partner, Davies Ward Phillips & Vineberg LLP and Chair, Corporate Governance Committee, American Bar Association
Panel #3
Eric J. Pan
Associate Professor of Law and Director
The Samuel and Ronnie Heyman Center on Corporate Governance
Structural Reform of Financial Regulation in Canada
Distinguished Panelists Included:
James Baillie, Of Counsel, Torys LLP
Paul Bourque, Senior Vice-President, Enforcement, Policy and Registration, IIROC
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Fair Value- Moving it Forward
Thursday April 23rd, 2009
Presenter
Dr. Wayne Landsman
Panel Discussion
Panelists discuss how the Fair Value/Mark to Market is likely to move forward in Canada from their unique viewpoints including:
a) Standard Setting
b) Regulator
c) Financial Statement Preparer
d) Financial Statement User
Distinguished Panelists Included:
Paul Cherry, Chair, Accounting Standards Board, CICA
Cameron McInnis, Chief Accountant, Ontario Securities Commission
Troy Maxwell, RBC Head of Governance and Wholesale Finance & CFO, Capital Markets
Dr. Peter Chant, FCA, Partner, Deloitte & Touch LLP
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ASSET BACKED COMMERCIAL PAPER CONFERENCE
Resolution and Impact on Capital Markets
Wednesday January 21st, 2009
Panel #1
Addressing Issues Arising from Canada’s ABCP Crisis
ABCP Case Study: A Canadian-Made Solution
a. Events leading up to/following crisis
• Montreal Accord; Pan Canadian Investors’ Committee
• In hindsight, would you change anything?
b. Financial aspects
c. Court aspects
Panelists
Jeremy Fraiberg, Osler
Stephen Halperin, Goodmans LLP
Andrew Kresse, MD, JP Morgan Securities – US
Gale Rubenstein, Goodmans LLP
Panel #2
Are significant regulatory changes needed to prevent similar problems in the future?
Issues discussed:
a. Exempt Market
b. Credit Rating Agencies
c. Mark to Market
d. Complex financial products
Panelists
Chair – Purdy Crawford, Osler
Andrew Kresse, MD, JP Morgan Securities – US
Jim Turner, Vice-Chair, OSC
Susan Wolburgh Jenah, CEO, IIROC
Mark White, Senior Director, OSFI
Keynote Luncheon Speaker - Tiff Macklem.
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ENFORCEMENT - CONFERENCE / SYMPOSIUM:
Advancing the Enforcement Agenda, Part 2: What’s the Solution?
Friday, May 2nd, 2008
A more effective, efficient, fair and balanced approach to the enforcement of securities laws is a desired outcome of many operating in the Canadian capital markets. But the question is how we get there when Canada has an extraordinarily complex enforcement landscape. There isn’t an easy answer. This day-long symposium brought government legislators, regulators, business leaders and academia together to discuss possible solutions to what is preventing Canada from having a more impactful enforcement reputation.
Over 100 guests participated in a focused discussion on greater effectiveness in investigation, prosecution and adjudication; balancing effective investigation and protection of rights; the need for a common enforcement agency; and the impact of enforcement on rules versus principles-based regulation. The purpose of the symposium was to keep the dialogue on enforcement in the forefront among leaders and influencers.
This symposium was sponsored by the Bank of Canada.
Conference Materials:
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ENFORCEMENT - ROUNDTABLE DISCUSSIONS:
- January 31, 2008 Investigation
- February 15, 2008 Prosecution
- February 29, 2008 Adjudication
While at this time it was deemed difficult to ignite any structural change to Canada's current regulatory system, CMI sought to focus attention on enforcement processes, including investigation, prosecution/defense and adjudication. It was viewed that small changes made within these processes could be more easily implemented and possibly ease some of the pressures. To that end, CMI organized 3 roundtables throughout January/February, 2008 with an invitation-only participant list.
The purpose of these roundtables was to create an intimate gathering of stakeholders where the is ample opportunity to discuss ideas for improvement that are currently on the table; throw out those that really don't work; add new, innovative ideas for consideration; prioritize based on degree of impact as well as categorize into those that are easily implementable under current structure. In essense, try to come up with a phased-in action plan for immediate implementation. Below is a summary of topics discussed at each of the roundtables.
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Roundtable
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Summary of Discussion
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Investigation
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- How can we ensure effective, efficient and fair investigation in securities matters?
- What tools does IMET need to improve the effectiveness of its investigation?
- Reflections on a Senior Independent Review Officer (SIRO).
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Prosecution
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- Prosecutorial discretion.
- Are criminal law prosecutions even necessary?
- Top 5 issues for the defence.
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Adjudication
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- Separation of the adjudicative function from the policy-making aspects of securities commissions.
- Should courts and commissions make orders for compensation and restitution.
- Is the deference accorded to securities commissions warranted.
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REGULATION - PLATFORMS FOR POLICY MAKERS & LEGISLATORS:
Expert Panel on Securities Regulation in Canada
The Rotman School of Management, University of Toronto's Capital Markets Institute has been appointed as the research resource to the Expert Panel on Securities Regulation in Canada. The panel, appointed in February by Federal Minister of Finance Jim Flaherty, is charged with providing advice and recommendations on securities regulation in Canada.
The panel will provide third party advice and recommendations to ministers -- federal, provincial and territorial -- on the best way forward to improve securities regulation in Canada and is expected to deliver a final report and draft model securities act by the end of 2008.
The CMI will assist in the design and direction of the panel's research program. Co-heads Paul Halpern, TSX Chair in Capital Markets at the Rotman School of Management, and Poonam Puri, an Associate Professor of Law at York University's Osgoode Hall Law School, will jointly carry out the function of research director.
www.expertpanel.ca
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