OBSI adds two consumer-interest directors to board

By Staff | June 26, 2023 | Last updated on June 26, 2023
2 min read
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The Ombudsman for Banking Services and Investments (OBSI) will have greater consumer representation on its board after it implements changes to its governance model following a public consultation.

That consultation, which ended earlier this year, was conducted after a 2021 independent evaluation that recommended a strategic review of OBSI’s governance structure to determine how best to ensure stakeholder interests were incorporated into board membership and decision-making.

The review recommended, among other things, that OBSI consider revising its governance structure to do away with designated directors that represent the industry, and directors that represent consumers.

It also recommended eliminating the requirement that industry directors be nominated by industry trade group the Canadian Bankers Association (CBA), and by the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA).

Such changes would reflect OBSI’s impartiality and independence, the review suggested.

In a release on Monday, OBSI said its designated consumer interest directors will be increased to three from one, and the board will continue to include three designated industry directors. However, the industry directors will no longer be selected solely from nominees put forward by the CBA, IIROC and the MFDA (the latter two now merged into the Canadian Investment Regulatory Organization).

At least one industry director will have current or recent expertise in the banking industry and one will have current or recent expertise with an investment dealer or mutual fund dealer, the release said.

All board members will be evaluated and selected based on a renewed skills matrix. Criteria will reflect such things as experience, geography and diversity.

“This new board structure is designed to balance consumer and industry expertise on the board and to allow the board to better reflect the diversity of industry sectors participating in OBSI’s service,” the release said.

In addition to these governance changes, OBSI is expanding its stakeholder outreach efforts by establishing separate bi-annual meetings with consumer groups and industry associations, it said. Other stakeholder input strategies — such as working groups, surveys and focus groups — will be pursued for specific projects as needed.

With greater consumer engagement on the board plus increased stakeholder outreach, the board decided not to reconvene the Consumer and Investor Advisory Council (CIAC), which provided consumer and investor input to OBSI’s board and management. The independent review had suggested scrapping the CIAC if governance was restructured.

Looking forward, OBSI said it remains open to engaging in governance-related discussions with the Canadian Securities Administrators as they continue their work on a potential proposal for providing OBSI with the authority to make binding determinations.

The ombudsman will also engage with the Financial Consumer Agency of Canada as it works toward implementing a single banking external complaints body system.

Earlier this month, a group of advocates headed by FAIR Canada called on the government to select OBSI as the single external complaint-handling body.

Advisor.ca staff


The staff of Advisor.ca have been covering news for financial advisors since 1998.