FAIR Canada has been advocating for the introduction of a clear duty for advisors to act in the best interests of their clients.  The US SEC is moving quickly to implement a fiduciary duty promptly on the passage of the US Wall  Street Reform and Investor Protection Act earlier this month.

Governments and regulators in the UK and Australia are also moving rapidly to implement a fiduciary duty for advisors and to better align the interests of investors and advisors.  Unfortunately the leading securities commissions in Canada have not indicated any plans to make similar moves to improve investor protection in Canada.  The closest a Canadian regulator has come to calling for a “duty to act in a client’s best interests” is a speech by Susan Wolburgh Jenah, the CEO of IIROC, where she states that:

“Putting clients first is at the core of regulatory reform efforts in Canada and elsewhere. To promote confidence in the quality and integrity of investment advisors as a “profession”, putting clients first needs to be the priority for industry participants as well.”

People like James Langdon at Investment Executive are starting to comment that it appears that the SROs may be doing more to enhance investor protection than the securities commission. The commissions must pick up the challenge and not leave it to the SROs to do the heavy lifting.  It is time that the financial industry truly became a “profession”, something that will only be accomplished if they are bound to act in the best interests of their clients.