Centre Tracking and Engaging at Highest Levels on Regulatory Reforms: Key Appointments Extend Centre Involvement

Over the past months of market crisis, we have accelerated our outreach to legislators, regulators, and other policy leaders to ensure that investors’ best interests are being served in whatever legislation results from the tangle of suggestions currently in discussion. Our latest outreach includes:

1. Our cosponsored Investors’ Working Group (IWG) — with the Council of Institutional Investors — has undertaken considerable outreach in efforts to represent the investor’s perspective as regulatory reform legislation is being drafted. When the Investors’ Working Group met with Congressional financial services leaders in Washington, DC, on 30 April, they had two goals in mind. First, they wanted to express some preliminary views on such topics as systemic risk oversight and the need to close regulatory gaps and strengthen regulatory agencies’ enforcement powers. They also encouraged legislators to proceed slowly with reform initiatives, suggesting that a hasty attempt to reach reforms now could create larger problems in the future. Second, the IWG participants wished to gain a better understanding of the climate in Congress on the matter of regulatory reform.
   
   In the end, Congressional leaders encouraged the IWG to submit its views as quickly as possible. In particular, the populist push for reform was forcing many in Congress to move faster than they felt comfortable doing. Indeed, most admitted that Congress does not have a full understanding of what went wrong and, therefore, would benefit from the independent IWG’s suggestions.
   
   As expected, proposals on regulatory reform began appearing within a month of that meeting. These proposals differed from original suggestions that made news. For instance, the Obama Administration pulled back from its original suggestion to consolidate most financial markets regulatory power and authority within the Federal Reserve Board. Although many within the Administration saw the Fed as a logical choice for systemic risk regulator given its access to the market, others saw strong conflicts of interest between its role as central banker and chief financial regulator. We will continue to monitor and assess the various proposals as they emerge and provide updates in the coming weeks.
   
   
2. Kurt Schacht, CFA, managing director of the CFA Institute Centre, has been appointed to the U.S. Securities and Exchange Commission Investor Advisory Committee to give investors a greater voice in the Commission's work. SEC Chair Mary Schapiro said, "Through this well-respected and diverse group, we are reaching out to investors in a new and significant way." Commissioner Aguilar, sponsor of the committee, added, "Investors need a greater voice at the Commission. The Commission's traditional role as the investor's advocate, as well as our deliberations, will be enhanced by the range of views the Advisory Committee will provide."
   
   Two key CFA Institute volunteers also have been appointed to this committee, whose mission to advocate for investors closely matches our own: Mark Anson, CFA, president and executive director of investment services at Nuveen Investments, is a member of the CFA Institute Board of Governors, and Ann Yerger, CFA, executive director of the Council of Institutional Investors, serves on the Centre’s Capital Markets Policy Council.
   
   
3. Patrick Finnegan, CFA, head of the Centre’s Financial Reporting Policy Group, has been appointed to a five-year term on the International Accounting Standards Board (IASB) beginning 1 July 2009. Although we are most appreciative that the IASB has made this appointment in recognition of the need to better incorporate the user’s perspective in its efforts and we look forward to the opportunity to enhance the Centre’s relationship with the IASB, Pat’s move to London comes at considerable cost to the Centre: We will miss Pat’s presence on our staff both personally and professionally. Another friend of the Centre, Patricia McConnell — former chair of the Centre’s Corporate Disclosure Policy Council and a contributor to our Comprehensive Business Reporting Model — also was appointed to the IASB. Our congratulations and thanks to both Pats as they shift their considerable experience and talents toward representing investors in their new roles on the IASB. Read the full press release.
   
   
4. Kurt Schacht is participating in the Project on Public Trust in Business — established by the Business Roundtable Institute for Corporate Ethics and the Arthur W. Page Society — and contributed to the recently released report “The Dynamics of Public Trust in Business — Emerging Opportunities for Leaders.” In the report, the organizations offer business leaders actionable recommendations, including opportunities to build and sustain public trust in their companies, their industries, and the institutions of business at a time when the idea of trust in business is in crisis. Read the full report and learn more about the Project on Public Trust.