Business Leaders Welcome Federal Initiative on Securities Regulation

July 13, 2005

The Canadian Council of Chief Executives (CCCE) enthusiastically welcomes the decision by federal Finance Minister Ralph Goodale to launch a federal-provincial discussion on reform of securities regulation.

“The flow of money around the world is growing with astounding speed. Canadian companies need more efficient access to capital. Canadian markets need to attract greater investment from abroad. Canadian investors need stronger protection and better access to investment opportunities,” said CCCE Chief Executive and President Thomas d’Aquino.

“Canada’s current system of 13 provincial and territorial regulators is too fragmented, too costly and too slow to manage change in this global environment. Canada needs a single regulator for its securities markets.”

The CCCE recently launched a major initiative aimed at improving Canada’s competitiveness. In a June 2005 statement signed by the Executive Committee, Canada First! Taking the Lead in a Transforming Global Economy, the CCCE highlighted the role of fragmented regulation of securities markets in reducing business investment and inhibiting productivity growth.

“We are delighted to see the government begin to focus more intensively on issues related to productivity and economic growth, and we are committed to working with the federal and provincial governments to find a way to move toward a single regulator for Canada’s securities markets,” Mr. d’Aquino said.

As the CCCE said in its 2003 submission to the federally-appointed Wise Persons’ Committee to Review the Structure of Securities Regulation in Canada: “Efficient and dynamic capital markets are vital to innovation, productivity, competitiveness and economic growth. They are too important to let jurisdictional jealousies get in the way of what is right for Canada.”

The meeting proposed by Mr. Goodale, which he hopes will take place later this summer or early in the autumn, would be the first-ever gathering of federal and provincial ministers with responsibilities for regulation of securities and financial markets.

Most provincial and territorial governments have agreed to form a “passport” system that in theory would allow companies to raise capital across the country while dealing with only one regulator. “While this concept represents an incremental improvement, it would not, even if successfully implemented, be sufficient to foster the dynamic capital markets that Canada’s economy needs,” Mr. d’Aquino said.

Replacing 13 regulatory bodies with one would offer many advantages to investors, to dealers and brokers and to both large and small issuing companies: one set of rules for all market participants; lower administrative and compliance costs; consistent interpretation and enforcement of rules; more timely response to changing circumstances; and a more effective Canadian presence internationally.

The CCCE’s member chief executives head companies that collectively administer close to $2.5 trillion in assets, have annual revenues of more than $600 billion and account for a significant majority of Canada’s private sector investment, exports, training and research and development.

In addition to Mr. d’Aquino, the members of the CCCE’s Executive Committee are: Chairman Richard L. George, President and Chief Executive Officer of Suncor Energy Inc.; Honorary Chairman A. Charles Baillie; and Vice-Chairmen Dominic D’Alessandro, Paul Desmarais, Jr., Jacques Lamarre, Gwyn Morgan and Gordon Nixon, the chief executives respectively of Manulife Financial, Power Corporation of Canada, SNC-Lavalin Group Inc., EnCana Corporation and Royal Bank of Canada.