Learn more about what the ASC is doing to support market participants and investors.
Once again, I find myself reflecting on a year of global volatility. The significant upheaval that has shaken the world — geopolitically, economically and socially — is unlike anything I have seen in my lifetime.
Our heartfelt support goes out to the people of Ukraine as they resist unjust aggression. The turmoil of the past two years persists with the different iterations of the pandemic, rising market volatility, inflationary pressures and more uncertainty. The resilience of people around the world inspires me and reinforces my belief that diligently preparing for the future is exceptionally important.
As a securities regulator, the ASC continues to rise to local, national and global challenges: we listen, we monitor what is happening around us, and we adjust to provide practical regulatory solutions in today’s changing landscape. As an active member of the Canadian Securities Administrators (CSA), we work hard to lay a strong foundation that will support a solid future for Alberta’s capital market.
In the past year, we provided intelligent regulation to foster a fair and efficient capital market that supports entrepreneurs, small businesses and all market participants while protecting investors. We focused on delivering the second year of our three-year strategic plan, and that plan has given us the flexibility to adapt and innovate.
The ASC made organizational changes in fiscal year 2022 (F2022) to better support our organization, the market and our stakeholders. We hired a Chief Information Officer to establish a long-term technology strategy that supports our needs and Alberta’s capital market. Our use of technology during the pandemic resulted in many advancements, including our ability to adopt a hybrid work model, allowing ASC staff to work in the office and remotely. This flexibility enhances employee satisfaction, team morale and retention.
To support innovation in the capital market, we recognized the need to create a new cross-divisional Innovation in Finance (InnoFin) team to work closely with entrepreneurs, small businesses and others. This team coordinates the ASC’s efforts in financial technology (fintech) innovation in the capital markets and regulatory innovation that can improve access to capital for Alberta businesses, while protecting investors.
Crypto investing has grabbed the attention of many Canadians over the last couple of years. It is important that regulation introduces integrity into crypto asset trading markets and appropriately addresses the risks to investors while allowing for innovation. To that end, the ASC and CSA are working to register crypto asset trading platforms (CTPs) that are dealing in securities or derivatives. We have a multidisciplinary task force that is busy processing registration and marketplace applications and related exemptive relief applications of CTPs, and which also considers any related policy issues concerning novel matters that arise. We have also been providing guidance to CTPs and entrepreneurs. Additionally, the ASC developed an information guide to help investors understand what crypto assets are, how securities law applies to crypto assets, how to minimize risk and how to protect themselves against fraud.
It has been a pleasure to lead the team working hard to establish a new single self-regulatory organization (SRO). The new SRO will consolidate the functions of the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA). Much work has been completed – and we are currently on our way to implementing the new SRO by the end of 2022 as planned.
Early economic indicators point to a recovery in Alberta’s energy sector. Though I am pleased with this rebound and commodity price improvements, I am also cognizant of market interest in other sources of energy, as well as environmental, social and governance (ESG) considerations. The ASC is co-leading the CSA’s proposed climate-related disclosure requirements project, and the Alberta industry is already leading in climate-related disclosure. I am confident that our oil and gas industry will continue to embrace technology and innovation, and be foundational to Alberta’s economy for the foreseeable future. Given the shift to alternative forms of energy, I believe our decision to expand the ASC’s focus from oil and gas to “all things energy” is sound, and our shift in perspective positions us well for the future.
As pointed out at our most recent ASC Connect, though investors and other stakeholders often focus on the “E” of ESG, the “S” and the “G” are equally important. The ASC is an active participant in the CSA’s project to consider broader diversity on boards and in executive officer positions. We consulted with Alberta industry leaders and partnered with the Institute of Corporate Directors to host a webinar that engaged a broader representation of our business community. We support enhancing disclosure about diversity of boards and executives.
I’m proud to announce that the ASC recently created scholarships for five Indigenous students studying full-time towards a Bachelor of Commerce degree at the Haskayne School of Business at the University of Calgary. Our capital market will benefit from more Indigenous individuals participating and providing their unique perspectives.
Engagement with stakeholders is crucial and again, technology has played an important role. In F2022, our ability to hold virtual seminars, presentations and events allowed us to connect with our employees working remotely, our colleagues across the CSA, and market participants and Alberta investors from all parts of our province. The benefits of virtual events are clear and in the future we will bring people together while also using technology. We don’t want to limit our stakeholders’ ability to access the insights, market trends, guidance and other resources that we offer.
The ASC has a strong foundation thanks to the work and dedication of our Commission Members. On behalf of the ASC’s senior management team, I want to recognize their wisdom, support and guidance. In particular, I would like to thank Maryse Saint-Laurent, who completed her second term with the ASC this year, for her valuable contributions over the last six years. We are also privileged to have access to market information and insight through the members of our seven advisory committees. Combined with the hard work and dedication of ASC staff, whose commitment to serving Albertans is unmatched and greatly appreciated, we remain a knowledgeable, relevant and forward-looking regulator that, as Wayne Gretzky would say, “skates to where the puck is going.”
Planning for our next three-year strategy is under way. This will involve research and meetings with stakeholders to align our future direction with market trends. As well, I am honoured to be named the new Chair of the CSA beginning July 1, 2022. I welcome the opportunity to further collaborate with my colleagues across the country to consider new perspectives and evolve intelligent regulation, balanced with strong investor protection.
Please see the adjacent pages for more details of each of the strategic pillars, and read our 2022 Annual Report for more information about our progress.
With kind regards,
Intelligently regulating the Alberta capital market is what we do. We strive to ensure that our regulatory regime is appropriate to the needs of our market, facilitates capital growth and promotes strong investor protection while not unduly burdening issuers and other market participants. We are keenly aware of the challenges the current economy is placing on market participants. We will continue to be mindful of proportionate regulation so as to not overstrain already struggling sectors.
All new laws, rules, policies and projects will be assessed to determine whether they add value, and to ensure there is due consideration of the costs of the regulation, compared to the benefits for Alberta’s unique capital market.
The ASC will continue to take part in the Government of Alberta’s red tape reduction initiatives and participate in the CSA burden reduction projects. Additionally, in an effort to support the resiliency and integrity of our capital market, the ASC will be implementing several of the initiatives identified through our Energizing Alberta’s Capital Market consultation with market participants.
To keep pace with the rapidly changing Alberta market place and constantly evolving securities industry, we are continuing our work in a number of areas, including:
Technology plays an important role across industries, including financial services. The ASC is continuing to plan and explore how we can improve our use of existing technologies and incorporate new technologies to increase efficiency, expand the use of analytics and support opportunities to use evidence-based decision making.
As regulators we must adapt to changing market conditions while providing a level of stability upon which market participants can depend. We will continue to work with the Canadian Securities Administrators (CSA) to be harmonized to the greatest extent possible, while still remaining a strong advocate for the unique needs of market participants in Alberta. We will also continually monitor and research alternatives, scanning both the domestic and international regulatory environments to inform our position and policies on a variety of securities matters. Projects include a review of the self regulatory structure and the exempt market.
While our primary responsibility is to oversee the Alberta capital market, we must do so cooperatively and mindfully of regulations that govern other jurisdictions both nationally and internationally. With the International Financial Reporting Standards (IFRS) bringing comparable accounting standards to the world’s capital markets, and the presence of new financial instruments such as crypto assets, securities regulation is increasingly complex and much of it occurs in an international arena. As such, we will continue to actively engage with the CSA, the HoA, the North American Securities Administrators Association (NASAA), IOSCO, and other national and international bodies, to stay informed, add value to the broader development of regulatory standards through our participation, and engage in areas that are critical to our being an effective, practical and intelligent regulator.
The ASC monitors current market activity, anticipates future challenges, collaborates with other organizations and acts decisively in order to promote confidence, inform and protect investors and support market integrity.
As securities fraud and misconduct becomes ever more complex, crosses borders and incorporates new technologies to mislead investors and escape detection, it is imperative that we have access to the right information, expertise, processes and technology to detect ‘bad actors’ and analyze data and evidence. This will support both our effectiveness and efficiency in enforcement proceedings.
Our plans also include continuing to play a leadership role in combatting market manipulations internationally through an ASC-led Cross Border Market Fraud Initiative, and continuing to pursue outreach with partner agencies to share information and collaborate.
Delivering effective compliance oversight is central to the ASC’s regulatory responsibilities. Over the next three years, we will make any necessary changes to ensure that we are optimally positioned to respond to the needs of our market. We will continue to proactively identify emerging issues, trends, and risks in securities and derivatives market structures, as well as associated trading, dealing and advising. Our goal is to provide thought leadership, and intelligent policy development and implementation, in areas relevant to the Alberta capital market.
Priority initiatives will include the operationalization of the client focused reforms and playing a meaningful role in the oversight of OBSI, including exploring implementing binding decision making. We will also continue to participate in the CSA project to protect elderly and vulnerable clients.
Cyberattacks are attempts by hackers to damage or destroy computer systems or networks. While all organizations are at risk from this type of security infringement, as an organization with access to sensitive data we must be particularly vigilant in our efforts to protect that information. It is imperative that our data remains safe and that we take all necessary measures to maximize our cyber resilience.
Investment literacy is a life skill that helps investors grow and protect their hard-earned money. With longer life spans and fewer companies offering defined-benefit pensions, it is increasingly important that Canadians become knowledgeable about how to safely invest for their future.
The ASC will continue its efforts to broaden investment literacy and enhance investor protection in Alberta. We plan to continue to enhance our consumer website, CheckFirst.ca, expanding tools and resources and empowering all Albertans to learn about investing. We will also actively expand our investor education outreach through partnerships and continue to conduct timely and frequent campaigns, leveraging data collected from our compliance and enforcement activities whenever possible.
The collective knowledge and experience of staff at the ASC is the foundation of our success. Their efforts to build strong relationships with individuals and organizations that participate in Alberta’s capital market are a critical part of the administration of provincial securities laws. We must continue to foster a strong sense of collaboration, including seeking input from market participants and encouraging a two-way flow of information.
Regular, timely and relevant engagement with all of our stakeholders is critical to effective administration of Alberta’s securities laws. Our priority is to enhance communications and increase two-way dialogue with both internal and external stakeholders, addressing their needs and incorporating valuable feedback into future endeavours, as appropriate.
To promote efficient decision-making and harmonization, we will ensure we have regular and meaningful communication between appropriate Government of Alberta officials and senior management.
In an effort to ensure our messages effectively reach and inform audiences, we continue to build relationships with media throughout Alberta, in addition to continually enhancing our digital communications properties.
We strive to ensure that employees have the right tools and resources to carry out their duties with proficiency, efficiency and consistency, and that projects and tasks that are pursued reflect strategic priorities. Additionally, we continue to provide a challenging and rewarding workplace that promotes employee recognition and invests in employee growth and development.
By engaging with employees, we will investigate opportunities for ongoing enhancements to the ASC workplace with a view to realizing our vision to be a best-in-class regulator.