Stability and consumer protection must always be key but competition and innovation also need to be priorities. Too often they aren't

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Canada’s financial regulators have long had mandates that prioritize stability and consumer protection. That approach helped the country fend off the worst of the 2008 financial crisis. But Canada has a productivity problem, and growth and innovation are important, too. It is hard not to conclude the regulatory balance has shifted too far in the direction of caution at the expense of innovation, competition and economic dynamism.

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Stability and consumer protection dominate the current stock of regulatory documents. Fewer than 15 per cent explicitly address market efficiency, innovation or competition. Most of the rulebook consists of conduct and supervision requirements: more reporting, changes in the type of communication required, more oversight of how financial products are sold and more obligations to prove firms are treating customers “fairly.”

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