Governance

FSCO is a regulatory agency of the Ministry of Finance that was established by the Financial Services Commission of Ontario Act, 1997 [New Window] (FSCO Act), with a mandate to provide regulatory services that protect the public interest and enhance public confidence in the regulated sectors.

 

Governance involves processes that permit the effective supervision and management of FSCO’s activities by senior management, the Commission, and the Minister of Finance.

 

A Memorandum of Understanding (MOU) [PDF Document] Size: 869 kb between the Minister of Finance, FSCO’s Chair, and the Superintendent of Financial Services/Chief Executive Officer (Superintendent) provides the foundation of FSCO’s governance. The MOU, which is updated every five years or more frequently as required, outlines the accountability framework between the Minister and FSCO, and establishes tools for governance and accountability. It also explains the roles, relationships, and mutual expectations of the Minister and FSCO.

 

As a regulatory agency, FSCO complies with the government’s Agency Establishment and Accountability Directive (AEAD). The AEAD sets out the process for establishing a new agency classified under the directive; the accountability framework governing agencies and ministries in the operation of agencies; and uses a risk-based approach in managing agency accountability. FSCO has a three-part structure, comprised of the:

 

The Commission has five members and each member is appointed for a fixed term by the Lieutenant Governor in Council. Appointments to the Commission are made in accordance with the guidelines established by Ontario’s Public Appointments Secretariat [New Window].

 

Together with the Superintendent, FSCO’s Commission is responsible for reviewing and approving key planning, and strategic and accountability documents including various internal documents, the Statement of Priorities, and the Annual Report.

 

The Superintendent administers and enforces the FSCO Act and all other Acts that confer powers on or assign duties to the Superintendent. All staff, who are public servants under the Public Service of Ontario Act, 2006 [New Window], report directly or indirectly to the Superintendent and perform FSCO's daily work. Under the direction of the Superintendent of Financial Services, FSCO has a number of internal committees that provide strategic leadership and oversee FSCO’s day-to-day activities.

 

FSCO’s Executive Committee provides strategic leadership and management to the organization and makes recommendations and decisions on organizational matters, including financial and human resource issues. The Corporate Management Committee leads and participates in strategic initiatives established by the Executive Committee and develops solutions to address policy and other matters identified by the Executive Committee. The Audit and Risk Committee oversees the quality of FSCO’s internal controls to ensure compliance with policies and procedures, risk management, accounting policies, and financial reporting.

 

The Financial Services Tribunal is an independent, adjudicative body that has exclusive jurisdiction to exercise powers conferred under the FSCO Act and other Acts that confer powers on or assign duties to the Tribunal.

 

Key Reporting Requirements

 

The Annual Financial Statements, Statement of Priorities, and Annual Report are publicly available and demonstrate how FSCO governs itself.

Financial Accountability

As an agency, FSCO is allocated an annual spending authority through the government resource planning process based on its organizational needs and government priorities. FSCO files quarterly reports with the government on its spending. The Office of the Auditor General of Ontario audits FSCO’s annual financial statements, as well as the annual financial statements of the Pension Benefits Guarantee Fund (PBGF) and the Motor Vehicle Accident Claims Fund (MVACF).

Statement of Priorities

No later than June 30 of each year, FSCO is required by the FSCO Act to deliver a Statement of Priorities to the Minister of Finance and publish it in The Ontario Gazette. The Statement of Priorities sets out FSCO’s strategic priorities and initiatives for the current fiscal year. The Statement also includes a report-back to stakeholders on key results from the previous year.

Annual Report

Also under the FSCO Act, FSCO must file an annual report with the Minister of Finance each year. It outlines FSCO’s activities to regulate insurance, pension plans, credit unions, caisses populaires, mortgage brokerages, co-operative corporations, and loan and trust companies in Ontario for the fiscal year. The financial statements of FSCO, the PBGF, and MVACF are included in the Annual Report.

 

Recovering FSCO's Costs

 

The majority of FSCO's costs are recovered from the regulated sectors through a combination of assessments and fees.