The Financial Regulatory Excellence Initiative
The Financial Regulatory Excellence Initiative will conduct rigorous and independent assessments of existing and proposed financial sector regulations, identify regulatory effectiveness and gaps, and promote a common understanding of optimal regulation.
To achieve this goal, the Initiative will leverage the reputation of the Institute's Financial Services Research Initiative for high-quality, evidence-based research and work collaboratively with stakeholders, including industry leaders, consumer advocates, and policymakers, to provide a framework that guides the assessment of past and new regulations for the sector. It will prioritize data-driven decision-making to support a regulatory framework that limits market uncertainty through transparency, accountability and responsiveness to the needs of Canadians.
Working Towards Excellence: Advancements for the Financial Regulatory Excellence Initiative
Regulation of financial markets is fundamental for an efficient, resilient and well-functioning financial market. With a comprehensive and structural analytical tool, laying out how financial sector rules and regulations have evolved over time, we can assist regulators develop a modern and efficient regulatory framework. Gherardo Caracciolo, Senior Policy Analyst, explains.
Financial Post Op-Ed: Financial regulation needs constant pruning
By Paul C. Bourque and Gherardo Gennaro Caracciolo
Regulation is an important part of Canada’s financial landscape. But to ensure the rules support an efficient, effective financial regulatory framework regulators need to be “constant gardeners.”
Canada has 44 different federal and provincial financial regulators and, as our recent analysis for the C.D. Howe Institute shows, the word count of their various rules and mandates continues to rise significantly year over year. The rules’ predominant focus is on risk reduction and consumer protection. Much less attention is paid to market efficiency, innovation and growth — though in the big picture they are at least as important. Our research shows that the balance is almost five-to-one: 85 per cent of initiatives primarily target risk and consumer protection, while only 18 per cent explicitly foster efficiency and promote growth. The numbers suggest the “balance” may actually be out of balance and that more attention needs to be paid to growth and efficiency.
The Good, the Bad and the Unnecessary: A Scorecard for Financial Regulations in Canada
Canadian financial sector rules need careful weeding to safeguard the system and market stakeholders, while creating conditions for innovation and efficiency, according to a C.D. Howe Institute report.
Paul C. Bourque and Gherardo Gennaro Caracciolo examine whether financial regulators’ activity follows a sound and structural approach – avoiding unnecessary regulations and implementing rules that ensure stability and consumer protection, while balancing the need for competition and innovation. The authors review rule-development practices and produce a scorecard of Canadian regulators’ performance; checking whether the principles followed are consistent with those defining efficient and effective regulatory frameworks.