The Board of the International Organization of Securities Commissions (IOSCO) met in Madrid this week to drive forward IOSCO’s work on market-based finance.
Chairman Greg Medcraft said ‘Capital markets are emerging as a key source of the finance needed across the globe to drive economic growth. Through a work agenda focused on fostering markets as a trusted source of capital, IOSCO is playing an important role in supporting that growth.’
During the week the Board, comprising 32 members from both developed and growth and emerging markets, discussed progress on a number of key initiatives.
On initiatives to support the G20-FSB efforts to restore stability in the global financial system and build economic growth, the Board progressed:
- Methodologies for identifying non-bank global systemically important financial institutions or activities in the areas of asset management and market intermediaries.
- The role capital markets and securities regulators can play in supporting long-term finance, including infrastructure investment and SME financing.
- The implementation of IOSCO Principles on Financial Benchmarks, the IOSCO Principles for Oil Price Reporting Agencies and the IOSCO Principles for the Regulation and Supervision of Commodity Derivatives Markets.
The IOSCO Board discussed audit quality and important initiatives to build confidence in global securities markets and to:
- reduce the reliance of asset managers and market intermediaries on credit ratings, and
- promote effective credible deterrence as a key element in improving investor protection and confidence in markets.
Members discussed the results of the IOSCO Research Department´s latest market survey on market trends, which emphasizes the growing leverage in securities markets, the impact of cross-border capital flows on emerging markets, financial risk disclosure, collateral management, and potential counterparty risk in central clearing houses. The market survey will be published next Monday.
Board members also examined policy measures aimed at building capacity in emerging markets and supporting the creation of strong regulatory frameworks for sustaining growth in both emerging and developed markets. The Board discussed possible capacity building projects and agreed to a proposal for a one-off fee from permanent Board members next year to start off the program. It also agreed to move forward on an IOSCO Global Certificate Program for Securities Regulators.
The meeting was preceded by a round table attended by the Board and four external experts on corporate governance from the financial industry and academia. Participants discussed the need for regulators to work towards restoring the social legitimacy of financial institutions, as a key step to safer financial markets and renewed trust in the financial system. The discussion highlighted the benefits to IOSCO and its members of co-operation and engagement with its members and industry.
Separately, the Comisión Nacional de Valores of Argentina became the 103rd signatory of the Multilateral Memorandum of Understanding on cooperation and exchange of information, during a signing ceremony in Madrid.