IOSCO Annual Conference: highlights and results
On 15-19 September, Luxembourg hosted the 38th Annual IOSCO Conference. Attracting more than 700 regulators and supervisors from around the world, “Connecting Global Finance” generated lively debate on issues from cybercriminality to the needs of emerging markets. LFF caught up with Jean Guill, the Director of Luxembourg's supervisor, the Commission de Surveillance du Secteur Financier (CSSF), to find out more about the future challenges and what we might expect in the months ahead.
What were the main goals of the IOSCO Annual Meeting? Can you highlight some of the most important results?
The Annual Meeting adopted a number of resolutions that are intended to streamline IOSCO’s governance structure and decision-making process. It also embarked on outlining a strategic plan for the years 2015-2020. We discussed how to advance the organisation’s work on global regulatory reform and on the preventative identification of emerging risks in securities markets. A joint statement by IOSCO and the IFRS Foundation on cooperation on international financial reporting standards was approved.
The meeting was also an important occasion for IOSCO to reach out to all stakeholders in securities markets, beyond the circle of its members. At this year’s meeting, the IOSCO Board approved the creation of a Committee entrusted with the sourcing of financial donations in order to support the needs of emerging markets jurisdictions.
One of the main topics focused on reinforcing IOSCO’s standards on cross-border cooperation. How will this be achieved?
The IOSCO Multilateral Memorandum of Understanding (MMoU) on cooperation and exchange of information embodies the standards used by securities regulators around the world to fight misconduct in the provision of cross-border financial services. Established in 2002, the MMoU has proven extremely successful, as 97 out of 125 eligible IOSCO members have signed up to it. Two new signatures were added during the Annual Meeting in Luxembourg.
Moreover, the Annual Meeting adopted measures to motivate the last outstanding members to subscribe to the MMoU. These measures aim to gradually restrict non-signatories’ rights in the organisation and may eventually lead to the suspension of their voting rights. The aim is to sign up all members by the 2014 Annual Meeting.
In the same vein, the recently established Assessment Committee of IOSCO has been tasked to promote full implementation of IOSCO principles and standards across its membership, i.e. through conducting peer reviews.
In which areas of global regulatory reform has most progress been made and what do you expect to be on the agenda next year?
Progress has over the past year been made in particular on the identification of systemically important financial institutions (SIFI), on credit rating agencies, on securitisation, on financial benchmarks, on OTC derivatives as well as on commodity derivatives.
As market based financing of the economy is becoming increasingly important, consistent global regulation across a wide array of financial products on offer will remain on the front-burner of the regulators’ agenda. Thus, the main theme for the 2014 Annual Meeting will be Market Based Financing for Global Economic Growth.
New topics to be addressed by regulators in the near future comprise the need to raise the standards of audit quality as well as the fight against cybercriminality. Investor education and financial literacy will also be a strategic subject of IOSCO’s ongoing work program.
IOSCO was also an opportunity to further introduce the Luxembourg financial center to professionals and supervisors from around the globe. Did they share any of their perceptions about the Grand Duchy with you?
IOSCO, as a global organisation, holds its Annual Meetings in alternating regions of the world in order to allow its membership to get a better, close-up view of different financial centers and markets. Most of my interlocutors were very impressed by the facilities and the program for the conference; we received many compliments for the organisation and the hospitality extended to our guests. I trust they went home with a positive memory of Luxembourg with a professional, diversified, well regulated and supervised financial sector.